When the total external and internal costs of a transaction are taken into consideration, this is known as
A. public costs.
B. social costs.
C. average total costs.
D. marginal costs.
Answer: B
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The costs imposed by inflation should be lessened in the future because of the following reform that took place during the early 1980s
A) airline deregulation. B) issuance of indexed government bonds. C) changing tax laws to ensure that savers are taxed only on real, rather than nominal capital gains. D) lifting of limits on interest paid on checking and savings accounts.
Which of the following represents an arbitrage transaction?
a. Traders buy silks where they are abundant and cheap, and haul them along a trail to another place where they would be quite scarce and valued. b. A trader buys a block of government bonds in one market where it is temporarily priced below where it can be immediately resold in a different market. c. Someone buys a block of Final Four tickets and scalp them at the game. d. A senior citizen buys a block of theater tickets at a senior discount and scalps them to teenagers behind the theater. e. All of the above are example of arbitrage.
Which of the following is true?
a. The fraction of their total disposable income that households spend on consumption is called the marginal propensity to consume. b. As the real interest rate falls, additional projects with lower expected rates of return become profitable for firms, and the demand for investment curve shifts right. c. Firms with excess inventories of finished goods have an increased incentive to invest in new capital to put those inventories to productive use. d. None of the above is true.
Refer to the accompanying figure. For Pat, the opportunity cost of planting one bulb is removing: 
A. 5 bags of trash. B. 1/20 of a bag of trash. C. 20 bags of trash. D. 1/5 of a bag of trash.