Consider a market in which there is an external cost. A tax can be used to arrive at the efficient market equilibrium because the tax will
A) decrease supply of the good.
B) increase supply of the good.
C) decrease demand for the good.
D) increase demand for the good.
A
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Which term describes the phases of expansion and contraction in an economy over time?
A. Recessions B. Prosperity C. Total product oscillations D. Business cycles
Which of the following is NOT true of a nation's production-possibility curve?
A. Points outside the production-possibility curve are not feasible production points given the resources in the economy. B. The negative slope of the production-possibility curve indicates declining productivity. C. Points inside the production-possibility curve are feasible, but may represent unemployment of some of the economy's resources. D. The production-possibility curve shows all combinations of amounts of different products that an economy can produce when its resources are fully employed.
According to the "feedback critique":
A. the conduct of firms in an industry may affect the market structure. B. the conduct of firms in an industry may affect the firm's performance. C. market structure may affect the firm's conduct. D. All of the statements associated with this question are correct.
The classical view of the labor market is basically consistent with the assumption of a vertical (or almost vertical) ________ curve.
A. aggregate expenditures B. aggregate supply C. production possibility D. aggregate demand