Chapter 9 Quiz
Chapter 9
GDP is the market value of all the final goods and services produced by all firms located in the United States in a given time period
Marginal external cost
The cost of producing an additional unit of a good or service that falls on people other than the producer.
Efficiency
Efficiency is achieved when the marginal social benefit equals the marginal social cost.
Which of the following best describes an externality? An effect of a transaction felt by someone other than the consumer or producer
Pollution is an example of a ____ externality? Negative production
Which of the following creates an external cost? Second-hand smoke sulfur emitted from smoke stack garbage on the roadside
The cost of producing one more …show more content…
unit of a good or service that falls on the producer of that good or service --is the marginal private cost. The cost of producing an additional unit of a good or service that falls on people other than the producer is the marginal external cost.
The marginal cost of production that is borne by the entire society is the marginal social cost.
When the production of a good has a marginal external cost, which of the following will occur in an unregulated market? Overproduction relative to the efficient level will occur ii. The market price will be less than the marginal social cost at the equilibrium quantity iii. A deadweight loss will occur
If a polluting producer is forced to pay a tax on its output, what is the effect on the supply and demand curves for the product? Both the supply curve and the demand curve shift leftward.
Marginal social cost equals marginal private cost ____ (minus; plus) marginal external cost. A pollution externality creates____ (efficient; inefficient) equilibrium. According to the Couse theorem, if property rights exist, then private transactions are efficient and the outcome ____ (is; is not) affected by who is assigned the property right. By setting the tax rate equal to the marginal __
__ (external; private; social) cost, firms can be made to behave in the same way as they would if they bore the cost of the externality directly.
Marginal ____ (social; external) benefit is the benefit enjoyed by society from one more unit of a good or service.
If the government leaves education to the private market, ____ (overproduction; underproduction) occurs. A payment that the government makes to private producers that depends on the level of output is ____ (a subsidy; public provision). The property rights of the creators of knowledge and other discoveries are ____ (intellectual property; patent property) rights.
The benefit the consumer of a good or service receives is the private benefit.
An external benefit is a benefit from a good or service that someone other than the ____ receives. Consumer
Marginal social benefit equals marginal private benefit plus marginal external benefit
If an external benefit is present, then the marginal social benefit curve lies above the marginal private benefit curve.
In an unregulated market with an external benefit, the quantity produced is less than the efficient quantity.
If all education in the United States were provided by private, tuition-charging schools, too little education would be consumed.
. Public universities are a service that is an example of public provision.
Which of the following is an example of a voucher? Food stamps
To provide the efficient amount of health care, the government could issue vouchers.
Chapter
14
The abbreviation “GDP” stands for Gross Domestic Product.
GDP is equal to the _market ___ value of all the final goods and services produced within a country in a given period of time.
The following are all final goods except flour used by the baker to make cupcakes.
Investment is defined as the purchase of new capital goods by firms.
In one year, a firm increases its production by $9 million and increases sales by $8 million. All other things in the economy remaining the same, which of the following is true? GDP increases by $9 million and inventory investment increases by $1 million.
The expenditure approach and the income approach are two methods used to calculate GDP.
Expenditure on used goods is not included in GDP. Wages is part of the income approach to calculating GDP. To calculate GDP, depreciation is added to net domestic product at factor cost. GNP equals GDP plus net factor income from abroad. For the United States, the difference between GDP and GNP is small Real GDP values production during the year using constant prices; nominal GDP values production using prices that prevailed during the year.
The expenditure approach to measuring GDP is based on summing consumption
Expenditure, investment, government expenditure on goods and services, and net exports minus wages, interest, rent, and profit.
According to the expenditure approach to measuring GDP, in the United States the largest component of GDP is consumption expenditure.
Which of the following is NOT one of the income categories used in the income approach to measuring GDP? taxes paid by persons
Nominal GDP can change if either prices or the quantities of goods and services change.
Chapter 15
The working-age population is the total number of people aged 16 years and over and who are not in jail, hospital, or some other form of institutional care. The unemployment rate equals the number of people unemployed divided by the labor force and then multiplied by 100. The labor force participation rate equals the labor force divided by the working-age population and then multiplied by 100. Discouraged workers are not counted as unemployed while other marginally attached workers are not counted as unemployed. Workers who are part time for economic reasons are not counted as unemployed.
to be counted as employed by the BLS, in the week before the survey the person must have worked for pay for ___1__.
Bo is available and willing to work but has not actively looked for work in the past month. Bo is ____ of the labor force and is ____not part; not counted as being unemployed
Between 1960 and 2011, he male labor force participation rate decreased and the female labor force participation rate increased.
The number of part-time workers for eco-nmic reasons ____ during recessions and the number of part-time workers for noneconomic reasons ____ during recessions
increases; does not change
GDP is the market value of all the final goods and services produced by all firms located in the United States in a given time period
Marginal external cost
The cost of producing an additional unit of a good or service that falls on people other than the producer.
Efficiency
Efficiency is achieved when the marginal social benefit equals the marginal social cost.
Which of the following best describes an externality? An effect of a transaction felt by someone other than the consumer or producer
Pollution is an example of a ____ externality? Negative production
Which of the following creates an external cost? Second-hand smoke sulfur emitted from smoke stack garbage on the roadside
The cost of producing one more …show more content…
unit of a good or service that falls on the producer of that good or service --is the marginal private cost. The cost of producing an additional unit of a good or service that falls on people other than the producer is the marginal external cost.
The marginal cost of production that is borne by the entire society is the marginal social cost.
When the production of a good has a marginal external cost, which of the following will occur in an unregulated market? Overproduction relative to the efficient level will occur ii. The market price will be less than the marginal social cost at the equilibrium quantity iii. A deadweight loss will occur
If a polluting producer is forced to pay a tax on its output, what is the effect on the supply and demand curves for the product? Both the supply curve and the demand curve shift leftward.
Marginal social cost equals marginal private cost ____ (minus; plus) marginal external cost. A pollution externality creates____ (efficient; inefficient) equilibrium. According to the Couse theorem, if property rights exist, then private transactions are efficient and the outcome ____ (is; is not) affected by who is assigned the property right. By setting the tax rate equal to the marginal __
__ (external; private; social) cost, firms can be made to behave in the same way as they would if they bore the cost of the externality directly.
Marginal ____ (social; external) benefit is the benefit enjoyed by society from one more unit of a good or service.
If the government leaves education to the private market, ____ (overproduction; underproduction) occurs. A payment that the government makes to private producers that depends on the level of output is ____ (a subsidy; public provision). The property rights of the creators of knowledge and other discoveries are ____ (intellectual property; patent property) rights.
The benefit the consumer of a good or service receives is the private benefit.
An external benefit is a benefit from a good or service that someone other than the ____ receives. Consumer
Marginal social benefit equals marginal private benefit plus marginal external benefit
If an external benefit is present, then the marginal social benefit curve lies above the marginal private benefit curve.
In an unregulated market with an external benefit, the quantity produced is less than the efficient quantity.
If all education in the United States were provided by private, tuition-charging schools, too little education would be consumed.
. Public universities are a service that is an example of public provision.
Which of the following is an example of a voucher? Food stamps
To provide the efficient amount of health care, the government could issue vouchers.
Chapter
14
The abbreviation “GDP” stands for Gross Domestic Product.
GDP is equal to the _market ___ value of all the final goods and services produced within a country in a given period of time.
The following are all final goods except flour used by the baker to make cupcakes.
Investment is defined as the purchase of new capital goods by firms.
In one year, a firm increases its production by $9 million and increases sales by $8 million. All other things in the economy remaining the same, which of the following is true? GDP increases by $9 million and inventory investment increases by $1 million.
The expenditure approach and the income approach are two methods used to calculate GDP.
Expenditure on used goods is not included in GDP. Wages is part of the income approach to calculating GDP. To calculate GDP, depreciation is added to net domestic product at factor cost. GNP equals GDP plus net factor income from abroad. For the United States, the difference between GDP and GNP is small Real GDP values production during the year using constant prices; nominal GDP values production using prices that prevailed during the year.
The expenditure approach to measuring GDP is based on summing consumption
Expenditure, investment, government expenditure on goods and services, and net exports minus wages, interest, rent, and profit.
According to the expenditure approach to measuring GDP, in the United States the largest component of GDP is consumption expenditure.
Which of the following is NOT one of the income categories used in the income approach to measuring GDP? taxes paid by persons
Nominal GDP can change if either prices or the quantities of goods and services change.
Chapter 15
The working-age population is the total number of people aged 16 years and over and who are not in jail, hospital, or some other form of institutional care. The unemployment rate equals the number of people unemployed divided by the labor force and then multiplied by 100. The labor force participation rate equals the labor force divided by the working-age population and then multiplied by 100. Discouraged workers are not counted as unemployed while other marginally attached workers are not counted as unemployed. Workers who are part time for economic reasons are not counted as unemployed.
to be counted as employed by the BLS, in the week before the survey the person must have worked for pay for ___1__.
Bo is available and willing to work but has not actively looked for work in the past month. Bo is ____ of the labor force and is ____not part; not counted as being unemployed
Between 1960 and 2011, he male labor force participation rate decreased and the female labor force participation rate increased.
The number of part-time workers for eco-nmic reasons ____ during recessions and the number of part-time workers for noneconomic reasons ____ during recessions
increases; does not change