Two advisors to the president have given their policy recommendations, and they are in disagreement. Why do these economists disagree?
A. Because they do not have all relevant information about the problem
B. Because they disagree on the nature of some cause–effect relationship
C. Because they have different values and opinions
D. All of the above are reasons for disagreements among economists.
Answer: D
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The average total cost curve is U-shaped. At the quantity of output where average total cost is at its minimum, is the marginal cost curve above the average total cost curve, below the average total cost curve,
or intersecting the average total cost curve?
Price floors typically improve market efficiency
a. True b. False Indicate whether the statement is true or false
Allocative efficiency occurs when firms produce:
a. where price equals minimum long run average cost. b. where price equals marginal cost. c. where consumer surplus is zero and producer surplus is positive. d. where marginal benefit equals marginal cost.
Which of the following policies would not improve the terms of trade from the point of view of import-competing industries in the United States?
A. Placing tariffs on imports of foreign goods. B. Restricting imports of foreign goods. C. Increasing the degree of free trade. D. "Buy American" campaigns.