What is government failure, and how would it be demonstrated on a production possibilities curve?
What will be an ideal response?
Government failure occurs when government intervention fails to improve economic outcomes. The production possibilities curve represents the alternative combinations of output that are attainable given the available resources and technology. Government failure means that government intervention has moved the economy to a less optimal point on the production possibilities curve or to a point inside the curve.
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The cost-output elasticity can be written and calculated as
A) MC/AC. B) AC/MC. C) (AC)(MC). D) (AC)2(MC). E) (AC)(MC)2.
Which of the following is not an explicit cost?
A) taxes B) rent C) wages D) opportunity cost of using an owner's savings
Which of the following relationships is correct?
a. GDP = GNP + Net foreign income b. GNP = GDP + Net foreign income c. GDP = Consumption + Net foreign income d. GDP = GNP + Balance of payments e. GDP = GNP adjusted for the foreign exchange rate
In response to the atrocities committed during World War II, the _________ was adopted, and its principles remain relevant
Fill in the blank(s) with the appropriate word(s).