On a production possibilities frontier showing possible output levels of good A and good B, the opportunity cost of producing the first 10 units of A will usually be
a. the same as the opportunity cost of producing the second 10 units of A
b. less than the opportunity cost of producing the second 10 units of A
c. greater than the opportunity cost of making the second 10 units of A
d. 10 units of A
e. 10 units of B
B
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"Partial" crowding out of fiscal policy occurs when the
A) LM curve is horizontal. B) LM curve is upward-sloping. C) LM curve is vertical. D) IS curve is vertical.
A customs union is a(n)
a. tax on an imported good b. union of similarly skilled workers c. group of countries that agree on common trade policies d. union of countries with similar customs e. agreement that affects intra-country trade
Which of the following examples would most likely happen if there was a money shortage?
a. Oliver takes all of his money out of CDs. b. Charlotte places half of her paycheck in CDs and half in a checking account. c. Hunter invests 90 percent of his money in U.S. Treasury bills. d. Ruby transfers $10,000 from CDs to a high-interest saving account.
Public goods are unlikely to be provided by the private sector because
A) the production of the good creates negative externalities. B) no one can be excluded from the consumption of the good. C) the consumption of the good creates negative externalities. D) the exclusion principle does not apply to public goods.