A Blue Ribbon Committee has decided that acid rain should be reduced and is trying to determine the optimal level of reduction. There are benefits from reducing acid rain (more wildlife and forests, better health, etc.), but there are also costs. The committee estimates that the marginal benefit of each unit of reduction is $700 - 5R, where R is units of reduction, and the marginal cost is 2R. If the committee wants to maximize the net benefit from reducing acid rain, what is the optimal level of pollution reduction?
A. $200
B. $100
C. $20
D. $10
Answer: B
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a. provides information about products, including prices and seller locations. b. has been proven to increase competition and reduce prices compared to markets without advertising. c. signals quality to consumers, because advertising is expensive. d. All of the above are correct.
The average propensity to consume (APC) equals
A. real disposable income divided by consumption expenditures. B. the change in consumption expenditures divided by the change in real disposable income. C. the change in real disposable income divided by the change in consumption expenditures. D. consumption expenditures divided by real disposable income.
What are the effects of an increase in the minimum wage? Who would be most affected?
What will be an ideal response?
When the aggregate demand curve shifts to the left, real GDP falls unless the aggregate supply curve is
A) horizontal. B) upward-sloping. C) vertical. D) upward-sloping or vertical.