Which of the following gives rise to a positive externality?
A) Sudden increase in the price of oil due to a supply shock
B) Sudden increase in the demand for diamonds leading to an increase in their price
C) Deforestation leading to the extinction of many species
D) Consumption of a drug to cure a communicable disease
D
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Assume that we want to drive our economy out of recession by generating a $400 billion change in real GDP. The MPC is 0.80 . Which of the following policy prescriptions would generate the targeted $400 billion change in income?
a. $120 billion increase in government spending and $50 billion increase in tax revenue. b. $140 billion increase in government spending and $70 billion increase in tax revenue. c. $160 billion increase in government spending and $120 billion increase in tax revenue. d. $220 billion increase in government spending and $100 billion increase in tax revenue. e. $400 billion increase in government spending and $300 billion increase in tax revenue.
Which of the following laws was enacted to forbid monopolization and attempts to monopolize?
a. The Anti-Monopoly Act b. The Sherman Antitrust Act c. The Trade Act d. The National Banking Act e. The Celler-Kefauver Act
The two basic reasons why a monopoly exists are barriers to entry and cost advantages
a. True b. False Indicate whether the statement is true or false
If we observe that when consumers' incomes rise by 10%, the quantity demanded of ice cream increases by 5%, then ice cream is an inferior good
a. True b. False Indicate whether the statement is true or false