The marginal benefit of an activity is
i. the benefit from a one-unit increase in the activity.
ii. the benefit of a small, unimportant activity.
iii. measured by what the person is willing to give up to get one additional unit of the activity.
A) i only B) ii only C) ii and iii D) i and iii E) iii only
D
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When Safeway supermarkets in the United States buys strawberries from Mexico
A) it uses dollars to pay Mexican farmers. B) it uses pesos to pay Mexican farmers. C) it may use any currency it chooses. D) the transaction shows up in the U.S. capital account.
Which of the following is NOT a reason given by economists for the failure of Okun's law to account for the rise in unemployment during the recession of 2007-2009?
A) increased willingness among firms to lay off workers during recessions B) a surge in productivity during the recession C) the unusual severity of the recession D) it does not take into account the effect of the stimulus
Peter is looking at a graph that shows the relation between inflation and unemployment. It measures the rate of inflation along the y-axis and the rate of unemployment along the x-axis. Peter believes that the graph shown to him is a short-run Phillips curve. Which of the following will strengthen his belief?
a. The points marked on the curves are (6, 4), (6, 3), and (6, 2). b. The points marked on the curves are (5, 4), (6, 4), and (7, 4). c. The points marked on the curves are (5, 4), (6, 3), and (7, 2). d. The points marked on the curves are (5, 4), (6, 5), and (7, 6).
Which of the following is an example of an externality?
a. Annie purchases a new dress. b. Antonio's dog barks loudly during the night, waking his neighbors. c. Harold sells a book to Cathy, who reads the book and then gives it to James as a gift. d. Gloria watches a scary movie.