Externalities are social costs that affect parties external to a particular economic transaction
a. True
b. False
Indicate whether the statement is true or false
True
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If production involves increasing opportunity cost, then on the production possibilities frontier, moving to a point closer to the horizontal axis will increase the opportunity cost of
A. the good that is shown on the horizontal axis. B. the good that is shown on the vertical axis. C. both of the goods shown on the axes. D. neither of the goods shown on the axes.
Evaluate the following statement. The Cournot model basically assumes that the sole decision of each firm in a duopoly is one of determining how much to produce not which price to set
What will be an ideal response?
If all firms are paying efficiency wages and nominal aggregate demand falls, then between maintaining nominal wages and reducing them firms generally find it more profitable to ________ them, thus ________ the unemployment rate
A) maintain, increasing B) maintain, maintaining C) reduce, increasing D) reduce, maintaining
If two bundles are on the same indifference curve, then
A) the consumer derives the same level of utility from each. B) the consumer derives the same level of ordinal utility from each but not the same level of cardinal utility. C) no comparison can be made between the two bundles since utility cannot really be measured. D) B and C.