"As compared to the benefits of economic and social regulation, the costs are minimal." Do you agree or disagree? Why?
What will be an ideal response?
Disagree. The total costs of regulation are substantial. First, the direct costs of regulation, which are ultimately paid for by taxpayers, include the costs to staff regulatory agencies and to fund their various activities. Second, there are social costs, which include the explicit costs and the opportunity costs of complying with the regulations.
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A decrease in the demand for beef because of concerns over cholesterol results in
A) lower beef prices. B) higher beef prices. C) an increase in the supply of beef. D) an offsetting increase in the demand for beef if the price of beef falls.
If output more than doubles when all inputs are doubled, production is said to occur under conditions of
A) increasing returns to scale. B) imperfect competition. C) intraindustry trade. D) interindustry trade.
From a monetarist perspective, instability in the macro economy arises from
A. the instability of velocity as a policy tool. B. the use of a monetary rule for monetary policy. C. secular trends in the economy. D. changes in monetary policy.
Education is a ________ good that creates a ________ externality.
A. public; negative B. public; positive C. private; positive D. private; negative