If companies who took into account an externality want to supply less at any given price compared to the original market supply, it must be a:
A. negative externality.
B. social externality.
C. positive externality.
D. network externality.
Answer: A
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Which of the following is an example of government discretionary spending?
A) defense spending B) net interest paid on government debt held by the public C) Social Security retirement payments D) Medicare benefits for the elderly
A difference in wages between a highly-educated worker and a less-educated worker
a. may be due to a difference in the amounts of human capital between the workers. b. may be a signal that the market is indifferent to a worker's level of human capital. c. is considered unfair by economists. d. is considered unfair by everyone.
Refer to the accompanying figure. For demand curve D1, what is the price elasticity of demand when P = 12?
A. 4 B. 12 C. 3 D. 6
Which of the following statements is false?
A) Monetarists believe that the velocity of money is highly stable. B) Monetarists believe that the velocity of money is predictable. C) Monetarists believe that the economy will settle into long-run equilibrium at less than full employment output. D) Monetarists believe that output can be at less than full employment output in the short run.