The hidden-cost fallacy occurs when
a. A firm considers irrelevant costs
b. A firm ignores relevant costs
c. A firm considers overhead or depreciation costs to make short-run decisions
d. Both a and c
b
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Refer to Figure 3.1. If Marge confesses to the crime and Homer does not, what is Homer's payout?
A) 1 year B) 2 years C) 7 years D) 15 years
As a tax increases, the excess burden from increasing the tax grows faster than the corresponding tax revenue. This is the impetus behind _____
a. lump sum taxes b. the excess burden rule c. the Ramsey rule d. placing taxes only on the most inelastic goods
If nominal GDP increased 2 percent during a year, while real GDP increased 4 percent, the
a. price level must have increased approximately 2 percent compared to the prior year. b. price level must have decreased approximately 2 percent compared to the prior year. c. price level must have decreased approximately 50 percent compared to the prior year. d. unemployment rate must have increased during the year.
________ and ___________ represent "new wave regulation"
Fill in the blank(s) with the appropriate word(s).