Underproduction compared to the efficient amount implies that for the last unit produced
A) marginal social benefit exceeds marginal social cost.
B) marginal social benefit equals marginal social cost.
C) marginal social cost exceeds marginal social benefit.
D) the deadweight loss is zero.
A
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There exists a strong ________ correlation between GDP per capita and ________
A) positive; child labor B) negative; life expectancy C) negative; child labor D) positive; unemployment rate
The Consumer Price Index (CPI) differs from a chain-weighted price index in that the CPI
A) compares the prices of all goods in one year to the prices of all goods in other years. B) measures the costs of a typical fixed basket of goods over time, while the chain-weighted index does not. C) requires calculation of GDP, while the chain-weighted index does not. D) allows for the goods consumed in an economy to change over time, while the chain-weighted index does not.
A publisher is deciding whether or not to invest in a new printer. The printer would cost $500, and it would increase cash flows by $600 for the next two years. What is the present value of the cash flows from the investment?
a. $1100 b. $541 c. $600 d. $1041
Rational production decisions require an understanding of
a. trade-offs.
b. opportunity costs.
c. scarcity of resources.
d. All of the above are correct.