The government could offer a subsidy to offset a:
A. negative externality.
B. positive externality.
C. network externality.
D. A subsidy could offset any of these.
B. positive externality.
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Use the following information to answer the question below. Cloe is given $4 of pocket money to be spent on either hard candies or chocolates. Chocolates cost 40 cents each and hard candies cost 80 cents each. The marginal utilities derived from the consumption of each product are as shown in the following table.Number of Items Marginal Utility of Chocolates Marginal Utility of Hard Candies 1 60 150 2 50 140 3 40 120 4 30 100 5 20 80 6 10 70 7 5 50 8 0 20 Which combination would maximize Cloe's total utility given her $4 budget?
A. 0 chocolates and 5 hard candies B. 2 chocolates and 4 hard candies C. 4 chocolates and 3 hard candies D. 6 chocolates and 2 hard candies
Suppose the price and quantity of steel fell at the same time. What might be the likelyexplanation of this using supply and demand analysis?
What will be an ideal response?
The time-inconsistency problem with monetary policy tells us that, if policymakers use discretionary policy, there is a higher probability that the ________ will be higher, compared to policy makers following a behavior rule
A) inflation rate B) unemployment rate C) interest rate D) foreign exchange rate
Government-imposed limits on price movements are likely to
A. increase economic efficiency. B. decrease economic efficiency. C. leave economic efficiency unchanged. D. promote economic growth in the economy.