According to the classical view, if consumer demand slowed down,
A. Investment and government demand would increase, and the economy would return to its long-term growth trend.
B. Wages would increase, and the economy would return to its long-term growth trend.
C. Prices would increase, and the economy would return to its long-term growth trend.
D. Prices would decrease, and the economy would return to its long-term growth trend.
Answer: D
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Explain how positive externalities cause a wedge between private marginal costs and social marginal costs. Give an example of a positive externality and explain why it is, in fact, a positive externality. Draw a supply/demand diagram and add a social marginal cost curve that represents the presence of the positive externality. Explain the relationship between the equilibrium quantity and that which is socially efficient.
What will be an ideal response?
As the Indian rupee depreciates relative to the dollar, total spending on Indian goods and assets will increase. Therefore, in the foreign exchange market, the
A) supply curve of euros is downward sloping. B) supply curve of dollars is upward sloping. C) demand curve for euros is upward sloping. D) demand curve for dollars is upward sloping.
Refer to the payoff matrix below. The Set High Price/Set High Price outcome is the ________.
A) Nash Equilibrium
B) cooperative equilibrium
C) pure -strategy Nash Equilibrium
D) dominant strategy equilibrium
Refer to Figure 9.6. Before this policy was implemented, consumer surplus was
A) $20. B) $4000. C) $6000. D) $8000. E) $12000.