If there is no scarcity,
A) choices are no longer rational.
B) all marginal benefits would equal zero.
C) the opportunity cost of an action would be greater than its sunk cost.
D) marginal cost of an action is greater than its marginal benefit.
E) an action would have zero opportunity cost.
E
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Using the "It's not fair if the result isn't fair" principle of fairness, an income tax designed to transfer wealth from the rich to the poor
A) increases efficiency and equity. B) increases efficiency and does not affect equity. C) decreases efficiency and increases equity. D) decreases efficiency and equity.
According to the shutdown rule, a firm should produce no output in the short run if
A) price is below minimum average total cost. B) price is above minimum average total cost. C) total revenues are lower than total fixed costs. D) price is below minimum average variable costs.
____________: Most probable selling price, assuming "normal" sale conditions. Value for the "typical" market participant may not be fundamental value.
Fill in the blank(s) with the appropriate word(s).
The budget of an unconstrained government is similar to a common pool resource, and this will lead to
A) lower interest rates and spending levels consistent with economic efficiency. B) excessive spending and budget deficits. C) lower taxes and a deficient level of spending. D) a deficient level of spending and budget surpluses.