Marginal social cost is equal to ________
A) marginal private cost plus the marginal external cost
B) the marginal external cost
C) the value of the tax that will make the market efficient
D) the marginal cost imposed on people other than the producer of the good
A
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When the Federal Reserve extends a discount loan to a bank, the monetary base ________ and reserves ________
A) remains unchanged; decrease B) remains unchanged; increase C) increases; increase D) increases; remain unchanged
Real GDP is the value of goods and services
A) adjusted only for unanticipated inflation. B) adjusted only for anticipated inflation. C) using base-year prices. D) using current-year prices.
A bank can lend out its excess reserves but not its required reserves
a. True b. False Indicate whether the statement is true or false
Paddy and Mick live in a small town. They burn coal to keep their houses warm at night. However, this burning of coal is harming the air quality of the neighborhood. Both Paddy and Mick could install air filters on their chimneys. These filters cost $50 each. Each filter provides a social benefit of $80, but those benefits are divided equally among Paddy and Mick. If both Paddy and Mick install
the filters, together they will _____. a. gain $10 b. gain $0 c. lose $20 d. gain $30