A subsidy is sometimes used by government to correct the problems associated with
A) negative externalities.
B) positive externalities.
C) internal benefits.
D) external benefits.
B
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When a country's currency is devalued
A) output decreases. B) output increases and the money supply decreases. C) the money supply decreases. D) output decreases and the money supply increases. E) both the output and the money supply increases.
Refer to the figure above. The elasticity of supply for a product will be 2 when:
A. a 1 percent decrease in the price causes a 0.2 percent decrease in quantity supplied. B. a 1 percent decrease in price causes a 2 percent decrease in quantity supplied. C. a 2 percent decrease in price causes a 1 percent decrease in quantity supplied. D. a 2 percent decrease in price causes a 2 percent decrease in quantity supplied.
Which of the following is not a direct determinant of net export spending?
A. Domestic income. B. Interest rates. C. Exchange rates. D. Foreign income.
If the firm operated at optimum efficiency, how much would its output be?
