Refer to the above figure. The market equilibrium quantity is Q1. Point Q2 represents the optimal amount of production. This indicates that there is
A) a public good which should be produced.
B) regressive taxation of the product.
C) a positive externality.
D) a negative externality.
C
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The consumption function describes the relationship between
A) investment and interest rates. B) consumer spending and income. C) consumers and firms. D) prices and demand.
The interest parity condition can be written as
A) R = R - (Ee - E)/E. B) R = R + (Ee - E)/E. C) R = R2 - (Ee - E)/E. D) R = R /(Ee - E). E) R = R + (Ee + E)/E.
Those individuals 16 years of age and over who are working in a job or actively seeking employment are called:
A) the labor force. B) the employed. C) the unemployed. D) none of the above.
Suppose we have the following information about a car manufacturer: car sales $1000M, steal purchases $600M, wages $300M, interest on business loans $50M, and profits $50M. What is its contribution to GDP using the product approach?
A) $1000M B) $600M C) $400M D) $350M