Tom and Jerry have two tasks to do all day: make dishes and build fences. If Tom spends all day making dishes, he will have make 16 dishes. If he instead devotes his day to building fences, Tom will build 4 fences. If Jerry spends his day making dishes, he will make 14 dishes; if he spends the day building fences, he will build 7 fences. For Tom, the opportunity cost of building a fence is __________ dishes made.
A. 16
B. 12
C. 8
D. 4
D. 4
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A common feature of regulated industries is cross-subsidization, which is a situation when one group of customers pays prices above costs while another group of customers pays prices below costs. The one group is subsidizing the other group
Is this practice more consistent with the capture hypothesis or the share-the-gains, share-the-pains theory? Explain.
If saving exceeds investment, then the level of GDP will
a. increase. b. remain constant. c. decrease. d. rise above potential GDP.
The basic idea behind the multiplier is that an increase in
a. GDP brings about an additional, larger increase in GDP. b. consumer spending causes a larger increase in investment spending. c. government spending causes a larger increase in tax revenues. d. spending will cause an even larger increase in equilibrium GDP.
Nearly half of federal government research and development spending takes place in the
A. National Science Foundation. B. National Aeronautics and Space Administration (NASA). C. Department of Defense. D. Federal Office of Technology Policy.