Neoclassical economists believe that the government fosters economic growth by providing a stable economic environment with a low rate of ____________ and tax rates that are low and unchanging.
a. importing
b. growth
c. unemployment
d. inflation
d. inflation
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Which of the following statements best describes an inferior good?
A) An inferior good is a good whose quantity supplied always exceeds the quantity demanded. B) An inferior good is a good whose demand decreases with an increase in consumers' income. C) An inferior good is a good that is sold at a subsidized price. D) An inferior good is a good that is rationed by the government.
Suppose it costs a farmer $1.00 to produce 1 unit of corn, $2.10 to produce 2 units of corn, and $3.30 to produce 3 units of corn. What's the average cost of producing 2 units of corn?
A) $1.00 B) $1.05 C) $1.10 D) $2.00 E) $2.10
Which of the following describes a positive externality?
A) The government imposes a tax on cigarettes in order to discourage smoking among teenagers. B) People who do not attend college still benefit from others who receive a college education. C) John Henry paints the outside of his house in order to increase its market value just before he puts the house up for sale. D) Mary volunteers to drive her neighbor's children to soccer practice.
Suppose the market supply curve is p = 5Q. At a price of 10, producer surplus equals
A) 50. B) 25. C) 12.50. D) 10.