In Figure 3-2, at point B
A. it is impossible to increase production of consumer goods.
B. it is impossible to increase production of capital goods.
C. it is possible to increase production of both capital goods and consumer goods simultaneously.
D. it is impossible to increase production of both capital goods and consumer goods simultaneously.
Answer: D
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Who is affected by externalities? Those receiving external benefits differ from those incurring external costs in that external benefits are associated with
a. government intervention b. market failure c. unclear property rights d. third parties e. free riders
As the large baby-boom generation moves into the retirement phase of life, this will
a. make it easier for the federal government to finance its budget deficit because the baby-boomers will be the wealthiest generation of retirees in American history. b. make it easier for the federal government to reduce spending because senior citizens do not spend much on consumption. c. make it more difficult for the federal government to finance its budget deficit because the retirement of the baby-boomers will mean more expenditures for Social Security and Medicare. d. not affect the federal deficit because there is no reason to expect that either federal spending or tax revenues will be influenced by the retirement of the baby-boomers.
Increases in deficit spending may be accompanied by
A. An increase in U.S. exports. B. A shift of the Aggregate supply curve to the right. C. A shift of the Aggregate demand curve to the right. D. The U.S. Treasury buying more bonds.
Firms with identical cost structures in a competitive market will have an upward sloping market long-run supply curve
a. true b. false