Exam 4: Efficiency in Resource Allocation: How Much Do We Have How Much Do We Want

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Income taxes result in allocative inefficiency because most people would work the same number of hours per year regardless of their hourly wage.

(True/False)

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Question 41

The total cost of production is measured as the:

(Multiple Choice)

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Question 42

Marginal social cost

(True/False)

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Question 43

Suppose a market is currently producing at a point where marginal social benefit exceeds marginal cost. For efficiency, production should:

(Multiple Choice)

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Question 44

Allocative efficiency exists when net benefit is as large as possible.

(True/False)

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Question 45

Use the following diagram to answer the following questions. -Refer to Diagram 4-2. In the above diagram, the efficient price and quantity will be

(Multiple Choice)

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Question 46

Use the following diagram to answer the following questions. -Use the following diagram. The total net efficiency loss from government rent controls is given by area:

(Multiple Choice)

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Question 47

Use the following diagram to answer the following questions. -Refer to Diagram 4-1. If production of compact discs is currently represented by quantity Q₁. The total cost of this production is given by area:

(Multiple Choice)

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Question 48

Use the following information to answer the following questions. -Refer to Bicycles. The marginal benefit of the fourth bicycle is:

(Multiple Choice)

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Question 49

Showing 41 - 49 of 49

Income taxes result in allocative inefficiency because most people would work the same number of hours per year regardless of their hourly wage.

The total cost of production is measured as the:

Marginal social cost

Suppose a market is currently producing at a point where marginal social benefit exceeds marginal cost. For efficiency, production should:

Allocative efficiency exists when net benefit is as large as possible.

Use the following diagram to answer the following questions. -Refer to Diagram 4-2. In the above diagram, the efficient price and quantity will be

Use the following diagram to answer the following questions. -Use the following diagram. The total net efficiency loss from government rent controls is given by area:

Use the following diagram to answer the following questions. -Refer to Diagram 4-1. If production of compact discs is currently represented by quantity Q₁. The total cost of this production is given by area:

Use the following information to answer the following questions. -Refer to Bicycles. The marginal benefit of the fourth bicycle is:

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Educational Reform: the Role of Incentives and Choice

Poverty: Old and New Approaches to a Persistent Problem

Tracking and Explaining the Macroeconomy

Unemployment: the Legacy of Recession, Technological Change, and Free Choice

Inflation: a Monetary Phenomenon

Sustained Budget Deficits: Is This Any Way to Run a Government

Social Security: Leading Issues and Approaches to Reform

International Trade: Beneficial, but Controversial

Financing Trade and the Trade Deficit

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