The optimal amount of air pollution is
A. a meaningless concept since we cannot monetize the environment.
B. found by equating the marginal benefits from reducing pollution by one more unit with the marginal costs of reducing pollution by an additional unit.
C. found by equating the total benefits from reducing pollution by one more unit with the total costs of reducing pollution by an additional unit.
D. found by setting the marginal benefits from reducing pollution by one more unit equal to zero.
Answer: B
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Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower
Structural unemployment may be particularly severe for
a. younger workers b. college graduates. c. older workers. d. workers with "high tech" skills.
All of the following are indicators of a nation's standard of living except
A. infant mortality rate. B. life expectancy. C. literacy rate. D. the inflation rate measured by CPI.
For a firm to be economically efficient from society's point of view, it should produce to the point at which
A. marginal cost equals price. B. average total cost equals price. C. marginal cost equals marginal revenue. D. marginal cost equals average total cost.