If the economy is in equilibrium, it must be
A. on the 45° line.
B. on the 60° line.
C. below the 45° line.
D. below the 60° line.
Answer: A
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If the marginal external cost of building a children's playground equals zero, then the i. marginal private cost equals the marginal social cost. ii. marginal social cost equals zero. iii. marginal private cost equals zero
A) i only B) ii only C) iii only D) ii and iii E) i and ii
One reason a country does not specialize completely in production is that production of most goods involves increasing opportunity costs
Indicate whether the statement is true or false
If the interest rate is 10% then the net present value of the investment is
a. $5,000 b. - $9,091 c. -$15,290 d. -$21,901
If we observe a decrease in the price of a good and a decrease in the amount of the good bought and sold, this could be explained by a(an):
A. increase in the supply of the good. B. increase in the demand for the good. C. decrease in the demand for the good. D. decrease in the supply of the good.