Which of the following will LEAST likely generate positive external effects to society?
A) education
B) fast food services
C) health care
D) requiring drivers to undergo periodic eye examinations
B
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The figure above shows the market for college education in the United States
If the government intervenes in the market and provides a subsidy to colleges to enroll the efficient number of students, the amount of the subsidy equals ________ per student. A) $5,000 B) $16,000 C) $13,000 D) $11,000 E) $7,000
If the great majority of shocks to our system arise from unpredictable shocks to money demand, the preferred tactic of monetary policy is targeting
a. reserves. b. interest rates. c. M2. d. reserves plus currency.
Suppose there are ten identical manufacturing firms that produce computer chips with machinery (capital, K) and labor (L), and each firm has a production function of the form q = 10KL0.5. What is the industry-level production function?
A) Q = 10K10L5 B) Q = 100KL0.5 C) Q = 100L0.5 D) none of the above
If the government wishes to decrease GDP by $2,000b, and the MPC is 0.6, it should:
A. increase its spending by $1,200b. B. decrease its spending by $1,200b. C. increase its spending by $800b. D. decrease its spending by $800b.