In a first-best world, for any commodity, the price of the commodity, the private marginal benefit, the private marginal cost of producing it, the social marginal benefit, and the social marginal cost are all equal at the margin.
Answer the following statement true (T) or false (F)
True
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Suppose an identical tax is levied on capital, labor, and land. Would the tax have the same effect in each of these markets? Explain your answer
What will be an ideal response?
Which of the following is not part of an argument that unions lead to increased productivity?
a. reduction in worker turnover b. improved morale c. employees with more motivation d. benefits from featherbedding
The word that best describes the relationship between the required reserve ratio and the money supply is
A) direct. B) constant. C) inverse. D) roundabout.
Exhibit 10-8 Aggregate demand and supply
In Exhibit 10-8, if aggregate demand shifts from AD1 to AD2,
A. real GDP will increase from $3.0 to $7.0, and the price level will remain the same. B. real GDP will increase from $3.0 to $4.0, and the price level will remain the same. C. real GDP and the price level will both remain the same. D. real GDP will increase from $3.0 to $4.0, and the price level will increase from 100 to 140.