Assume that Oscar is maximizing his total utility and that the equal marginal principle holds by the time he is done allocating his budget.If MUa/Pa = 100/$35, MUb/Pb = 300/?, and MUc/Pc = 400/?, the prices of products B and C
A. cannot be determined from the information given.
B. must be $105 and $175, respectively.
C. must be $100 and $200, respectively.
D. must be $105 and $140, respectively.
Answer: D
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Suppose the production of a good results in negative externalities. If all costs are taken into account, then
A. output will occur at the socially optimal level. B. the price of the product will be higher than if all costs are not taken into account. C. more output will be produced than if all costs are not taken into account. D. a and b E. a, b, and c
The relationship between prices and the corresponding quantities supplied is shown in a:
a. supply schedule. b. demand schedule. c. price-earnings ratio. d. production possibilities curve. e. total output schedule.
Which of the following led to the collapse of the Phillips curve?
A. Rightward shift in the demand for labor curve B. Leftward shift of the Phillips curve C. Leftward shift of the aggregate supply curve D. Rightward shift of the aggregate demand curve
Suppose the actual equilibrium federal funds rate is above the rate implied by a particular inflation goal. In this situation, the Taylor rule implies that
A) monetary policy is contractionary. B) monetary policy is expansionary. C) fiscal policy is expansionary. D) fiscal policy is contractionary.