When an activity results in the creation of external benefits, markets will produce more than the socially optimal level of that activity
a. True
b. False
A
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A steep slope in a time-series graph means the variable is
A) high. B) falling. C) rising or falling quickly. D) rising or falling slowly. E) very close to its trend point.
Refer to Figure 4-6. What area represents producer surplus at P2?
A) A + B + D B) B + D + G C) B + C + D + E D) B + D
An important factor that increased international capital flows in the latter part of the 1800s was
A) the creation of the International Monetary Fund. B) the creation of numerous regional trade agreements. C) the rapid rate of East Asian economic growth. D) technological innovations. E) the creation of the World Bank.
In the graph for the consumption function, the 45-degree line
A) contains only a consumption component.
B) represents both planned consumption and planned investment.
C) shows various combinations where planned consumption equals real disposable income.
D) reflects a decreasing APC as real disposable income rises.