The cross-elasticity of labor with respect to capital is the
A. change in wages relative to a change in the price of capital.
B. percent change in labor relative to a percent change in capital.
C. percent change in wages relative to a percent change in the price of capital.
D. percent change in labor relative to a percent change in the price of capital.
E. change in labor relative to a change in capital.
Answer: D
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A) 2 B) 3 C) 7 D) 8
Marginal external costs are
a. additional unpriced costs imposed on society by producing one more unit of a good b. the cost of damaged goods c. the additional cost of imported goods d. the total cost to society of producing a good e. the marginal cost divided by the marginal revenue
Suppose that the U.S. personal income tax was eliminated and replaced with a fixed tax that raised the exact same amount of revenue. The multiplier would be
a. larger. b. unchanged. c. smaller. d. incalculable.
If a unit excise tax is placed on a good for which the demand is very unresponsive to a price change, then
A) the government generally pays the majority of the tax. B) the consumers generally pay the majority of the tax. C) the producers generally pay the majority of the tax. D) producers and consumers pay equal portions of the tax.