One important consequence of the public debt in the United States is that:
A. incentives to work are increased.
B. it transfers a portion of real output to foreign nations.
C. there is greater saving at every level of disposable income.
D. income inequality is reduced.
Answer: B
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Consider the production of some industrial good that creates air pollution. The table below gives the marginal social cost (MSC), the marginal cost (MC), and the marginal social benefit (MSB) for each level of output (Q)
Q MSC MC MSB 1 3 2 11 2 6 4 10 3 9 6 9 4 12 8 8 5 15 10 7 6 18 12 6 The inefficient market quantity is ________ and the efficient market quantity is ________. A) 4; 3 B) 6; 3 C) 3; 4 D) 4; 6
Which statement is false?
A. Compared to 30 years ago, there is more sentiment in the U.S. for protection against the import of foreign goods. B. The basis for international trade is specialization. C. Our balance of trade has been negative since the early 1900s. D. None of these statements are true.
How will the price and output of a monopolist compare with perfect competition?
A. The output of the monopolist will be too large and the price too high. B. The output of the monopolist will be too large and the price too low. C. The output of the monopolist will be too small and the price too high. D. The output of the monopolist will be too small and the price too low.
In the above figure, if a firm is cleaning up Q2 units of pollution, it is an
A. efficient solution, because marginal social benefits are greater than marginal social costs. B. efficient solution, because marginal social benefits are equal to marginal social costs. C. inefficient solution, because marginal social benefits are greater than marginal social costs. D. inefficient solution, because marginal social costs are greater than marginal social benefits.