The additional cost a firm will incur by producing one additional unit of output is the:
A. variable cost.
B. marginal cost.
C. fixed cost.
D. total cost.
Answer: B
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Starting from long-run equilibrium, a decrease in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. higher; potential D. lower; higher
From the standpoint of ________, specialization in lending is surprising but makes perfect sense when one considers the ________ problem
A) moral hazard; diversification B) diversification; moral hazard C) adverse selection; diversification D) diversification; adverse selection
Which of the following is a barrier to economic growth in many developing nations?
A. the lack of natural resources B. the lack of economic freedom C. the low level of restrictions in the labor market D. the shortage of labor
Taxes are increased by $50 billion and income decreases by $300 billion. The value of the tax multiplier is
A. -3. B. -5. C. -6. D. -15.