Suppose the federal government is considering alternatives to increase the level of real GDP in order to reduce unemployment. It can only do one of the following. Which will have the smallest impact on the federal budget?
a. decreasing transfer payments
b. increasing government spending
c. increasing transfer payments
d. decreasing government spending
b
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Is it true that in the long run it is impossible for firms functioning in a perfectly competitive market to earn positive economic profits? Explain your answer
What will be an ideal response?
Allocative efficiency occurs when
A) we cannot produce more of any good without giving up some other good that we value more highly. B) we cannot produce more of any one good without giving up some other good. C) marginal benefit exceeds marginal cost. D) opportunity costs are decreasing.
Total economic surplus will be ________ in nations with well-defined property rights than in nations with poorly-defined property rights.
A. lower B. no different C. less predictable D. higher
Inventories are
A. goods that have not been purchased but have been produced during the current year. B. consumer expenditures. C. part of the debt surplus. D. part of next exports.