What is a private benefit from consumption? What is a social benefit from consumption? When is the private benefit from consumption equal to the social benefit from consumption?
What will be an ideal response?
Private benefit from consumption is the benefit received from the consumer of a good or service. Social benefit from consumption is the total benefit from consuming a good or service, including both the private benefit and any external benefit. The private benefit and the social benefit are equal when no externalities exist.
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Which of the following statements is true?
A) In a closed economy, government spending equals zero. B) A nation with a high savings rate will accumulate capital rapidly. C) A nation with a high savings rate will accumulate capital slowly. D) In a closed economy, aggregate consumption equals zero.
If property rights for air and water exist, then polluters bear the costs of pollution
Indicate whether the statement is true or false
Which of the following government policies would most likely result in an increase in economic growth?
A) a decrease in the life of a patent from 20 years to 15 years B) a decrease in government spending on grants issued through the National Institutes of Health C) a decrease in the interest rate at which the government provides student loans D) decreased copyright protection on music and movies
An employer faces a higher minimum wage control where it cannot pay its workers any less than $10.25 an hour. The employer may react by
a. Doing nothing-it cannot violate the regulation b. Offering the employees fewer fringe benefits c. Increasing spending on workplace amenities d. Hiring additional workers