Refer to the above figure. S1 is the supply curve that includes only private costs. S2 is the supply curve that includes social costs. The free market rate of output is ________ and the corrected, socially optimal amount of output is ________.
A. Q4; Q1
B. Q2; Q1
C. Q2; Q4
D. Q4; Q2
Answer: D
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The statement "The unemployment rate for teens is higher than that for adults" is
A) a political statement. B) a positive statement. C) a normative statement. D) an ethical statement.
Economics is best defined as the study of how individuals decide to use limited resources in an attempt to satisfy unlimited wants
a. True b. False
Recessions
A. almost never occur in the American economy. B. follow a regular and predictable cycle. C. are common features of the American economy. D. have been abolished by wise macroeconomic policy.
Suppose the price of one euro is fixed at $1.00. A Dutch oil company discovers new oil reserves in the North Sea and offers the oil for sale. What is the impact on the foreign exchange market?
a. The dollar price of euros decreases from $1.50 to $1.00.
b. Decreasing demand for European goods shifts D2 to D1.
c. U.S. consumers demand more European goods shifting D1 to D2.
d. The quantity of euros demanded changes from Q2 to Q1.