Which of the following is not a reason for the Ricardian equivalence theorem to fail to hold?
A) tax distortions
B) people can borrow from the government.
C) finite-lived people.
D) credit market imperfections.
B
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The above figure shows the marginal private benefit and marginal social cost of a college education. If society's external benefits from college graduates is $10,000 each, then the private market outcome is inefficient because
A) no students will go to college. B) society places less value on educating the next student than it will cost society to educate that student. C) society places greater value on educating the next student than it will cost society to educate that student. D) the marginal cost will shift upward.
A specialized rice grower sells rice in two markets, the United States and Japan, and the marginal cost is the same in both markets. The price elasticity of demand in the United States is -2.0, and the price elasticity of demand in Japan is -1.5
If the grower practices group price discrimination, which country's consumers will pay a higher price and by how much?
Which statement is true?
A. Foreigners are holding over $1 trillion in U.S. currency (which they have not invested in the U.S.). B. If foreigners keep buying U.S. assets, we will run out of things to sell before the year 2025. C. Within 10 years the United States will probably go bankrupt. D. None of these statements are true.
In which case would the quantity of money demanded by the public tend to increase by the greatest amount?
A. The interest rate increases and nominal GDP increases B. The interest rate increases and nominal GDP decreases C. The interest rate decreases and nominal GDP decreases D. The interest rate decreases and nominal GDP increases