Which of the following is an example of an external cost?
A) a grove of trees planted in a park in Seattle
B) a library built in Philadelphia
C) a new, faster computer chip
D) an oil spill off the coast of South America
E) a student graduating from college
D
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If a firm is earning just enough to cover all its economic profits does that mean it's not making a profit?
What will be an ideal response?
What is a result of unemployment that is very low?
What will be an ideal response?
The provisions in state constitutions requiring them to balance their budgets mean that:
A. state governments can follow a functional finance approach with greater consistency than the federal government, which has no such requirement. B. state government spending acts as an automatic stabilizer for the national economy. C. state governments often behave procyclically because lower revenues during recessions means lower state spending. D. state governments can only use monetary policy to affect their economies.
Refer to the information provided in Figure 33.4 below to answer the question(s) that follow.
Figure 33.4Refer to Figure 33.4. The domestic price of a leather wallet is $20. With free trade the price of a leather wallet is $10 and after a tariff is imposed the price is $15. If the tariff is raised so that it now equals $10, tariff revenue in this country will be
A. $0. B. $1,000. C. $2,000. D. $3,000.