The largest and fastest-growing category of federal government expenditures is
A) grants to state and local governments.
B) interest on the national debt.
C) national park spending.
D) transfer payments.
Answer: D
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When __________________, a firm will supply a higher quantity at any given price for its output, and the supply curve will shift to the right.
A. prices rise B. equilibrium is achieved C. costs of production fall D. there is a population increase
One possible solution to an incentive problem arising under unobservable actions is:
A. to be the boss and fire the inefficient worker and send a signal to others. B. to pay more and make the worker efficient. C. to sell the agent the right to the total production. D. to buy the agent's right to his total output.
Figure 11-1
In Figure 11-1, to achieve equilibrium at potential GDP the government could
a.
increase taxes.
b.
decrease transfer payments.
c.
increase government purchases.
d.
None of the above is correct.
Which of the following formulas is used in step 3 of the three-step method for monopolistic competition?
a. TC = ATC ? q b. TR = P ? q c. TC = P ? q d. TR = ATC ? q