Refer to Scenario 4 . Assume that the state originally spent one-half of its budget on schools and one-half on prisons
What was the production of schools and prisons? Could the same number be achieved after the price of producing prisons falls to $1.5 million and the price of producing schools rises to $2 million? Explain.
Production is five schools and two and one-half prisons. No, the same number of schools and prisons could not be built after the price of production changes. If the state continues to divide its budget equally, production would be two and one-half schools and three and one-third prisons. If the budget were juggled, the maximum number of schools that could be built is five, but no prisons could be built. And, if two and one-half prisons were built, there would be enough left in the budget to build just over three schools.
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Refer to the table above. If the market supply of labor per week when the wage rate is $100 is 125 hours, labor supplied by Jim per month at the wage rate is:
A) 12 hours. B) 30 hours. C) 50 hours. D) 75 hours.
How do external costs prevent a competitive market from allocating resources efficiently?
What will be an ideal response?
Goal independence is the ability of ________ to set monetary policy ________
A) the central bank; goals B) Congress; goals C) Congress; instruments D) the central bank; instruments
The main disadvantage to forming a corporation is
a. low profits b. double taxation c. small number of owners d. difficulty in raising funds e. stockholders usually control the company