What is the total amount that the government should spend on the construction project to attain maximum net benefits for the society?
A. $8 million
B. $14 million
C. $19 million
D. $37 million
Ans: C. $19 million
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The value of the marginal product of any input is equal to the marginal product of that input multiplied by the
a. wage. b. marginal cost of the output. c. change in total profit. d. market price of the output.
Why don't competitive markets do a good job providing public goods?
a. Because people do not receive benefits from public goods. b. Because it is difficult to exclude people from gaining benefits from public goods without paying for them, and so market demand does not reflect the benefits to society from the public good. c. Because public goods generate negative externalities, and pollution taxes reduce the incentive for firms to supply public goods. d. Because firms cannot produce enough to satisfy market demand.
Getting a college degree is an example of investing in
A. physical capital. B. research and development. C. technology. D. human capital.
Marginal utility can:
a. increase positively, but not negatively
b. be positive, negative, or zero
c. decrease, but not become negative
d. be positive or negative, but not zero