The three questions every economic system must answer must include which of the following?
a. Where the goods and services should be produced?
b. What goods and services should be produced?
c. Who should produce the goods and services?
d. All of the questions must be answered for the economic system to work.
b
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Margaret Thatcher, the prime minister of Great Britain in the 1980s introduced a new system to replace local government taxes
The rates were replaced by the Community Charge or 'Poll Tax', which applied the same amount to every individual resident, with an 80% reduction for the unemployed. Inspite of the fact that this tax was unpopular and was eventually repealed can you think of any reason why it could be characterized as efficient? Can you think of any way that this tax could be evaded?
Refer to Figure 13-13. What is the area that represents the firm's profit?
A) profit = 0 B) P3baP2 C) P4edP2 D) P4eaP1
Subsidizing coal mining and orange growing have both been found to be economically inefficient in that the costs outweigh the benefits. However, a subsidy on coal mining would help the coal producers in West Virginia and a subsidy on orange growing would help the orange farmers in Florida. So the senator from West Virginia approaches the senator from Florida and says that he will vote for the
orange subsidy if the Florida senator votes for the coal-mining subsidy. The Florida senator agrees. Which term best describes what just happened? a. the shortsightedness effect b. logrolling c. the use of user charges d. the political voter theory
Assume the minimum wage exceeds the market-clearing wage. If there is an increase in the supply of labor then the number of workers who are unemployed will ________, and the number of workers who are employed will ________.
A. increase; not change B. increase; increase C. decrease; increase D. increase; decrease