Average cost equals total cost multiplied by the number of units of output
a. True
b. False
Indicate whether the statement is true or false
False
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Economists have focused more attention on the formation of expectations in recent years. This increase in interest can probably best be explained by the recognition that
A) expectations influence the behavior of participants in the economy and thus have a major impact on economic activity. B) expectations influence only a few individuals, have little impact on the overall economy, but can have important effects on a few markets. C) expectations influence many individuals, have little impact on the overall economy, but can have distributional effects. D) models that ignore expectations have little predictive power, even in the short run.
If education creates positive externalities,
a. private markets provide less than the socially optimal quantity of education b. private markets provide more than the socially optimal quantity of education c. the marginal private benefit curve is higher than the marginal social benefit curve d. the marginal private cost curve is higher than the marginal social cost curve e. the government should impose a depletion tax
Which of the following is not a basic question that each economy must answer?
a. Which resources are scarce? b. For whom shall the goods be produced? c. How shall goods be produced? d. What goods shall be produced?
The Department of Commerce sums the payments made to resources to arrive at GDP in the form of compensation of employees, rents, profits, net interest, indirect taxes, and depreciation. This method of deriving GDP is called the:
A. opportunity cost approach. B. income approach. C. expenditure approach. D. monetarist approach.