If production creates a negative externality, social welfare can be increased through
a. antitrust law
b. subsidization
c. taxation
d. free market policies
e. allocative efficiency
C
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The association of each quantity of a variable input, like labor, to its total product is the
a. short-run production function. b. average product of labor. c. stage of production. d. expansion path.
Does it appear that currency boards make low-inflation policies credible?
What will be an ideal response?
Targeting reserves would be the best choice if
A) there is a close and predictable relationship between bank reserves and total spending. B) there is an unpredictable relationship between bank reserves and total spending. C) the discount rate is fixed. D) private sector spending is very stable.
There is a positive correlation between a nation's average annual inflation and the degree of independence of its central bank
a. True b. False Indicate whether the statement is true or false