When state and local governments provide public schools with a per-unit subsidy to provide educational services, the price that the schools providing these services receive is
A) less than the price that consumers pay to receive educational services.
B) less than the amount of the per-unit subsidy that the schools receive.
C) greater than the market clearing price without the subsidy.
D) equal to zero.
C
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If the quantity of real GDP demanded is greater than the quantity of real GDP supplied, then
A) the economy must be producing at potential GDP. B) aggregate demand changes to restore equilibrium. C) the price level falls to restore the macroeconomic equilibrium. D) the price level rises and firms increase production. E) the price level falls and firms decrease production.
Differentiate between a change in demand and a change in quantity demanded
What will be an ideal response?
The principle of diminishing marginal utility can be used to explain why
A) Bob's second soda is less enjoyable than his first soda. B) Bob's first soda is less enjoyable than his second soda. C) Charlie enjoys his fourth soda less than Bob enjoys his first. D) Bob enjoys his first soda more than Charlie enjoys his fourth.
In the figure above, point B represents
A) a current account deficit. B) a current account surplus. C) a reduction in inventories. D) a temporary imbalance in the money markets.