Nominal GDP will increase
A) only if the quantity of final goods and services produced rises.
B) if either the price level or the quantity of goods and services produced rises.
C) only if the price level rises.
D) only if the price level falls.
B
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Four stores have a problem with theft and security is a public good. Let S stand for the number of person-hours of security patrols per week. The marginal benefit of security patrols to each of the stores is given by the formula MB = 200 - 2S. Patrols cost $20 per hour. What is the socially efficient level of security?
A. 90 person-hours of patrols per week B. 100 person-hours of patrols per week C. 92.5 person-hours of patrols per week D. 97.5 person-hours of patrols per week
The actual time length of the short run is determined by when diminishing marginal returns start
Indicate whether the statement is true or false
By requiring that policyholders pay a deductible on a claim, insurers guard against
a. symmetrical information b. adverse selection c. natural selection d. moral hazard e. the winner's curse
The most desired goods and services that are foregone in order to obtain something else are the
A. Average total cost. B. Marginal cost. C. Opportunity cost. D. Variable cost.