What is the optimal level of provision of public goods?
What will be an ideal response?
The optimal level of provision of public goods is the level at which resources are drawn from the production of other goods and services only to the extent that people want the public good and are willing to pay for it. At this level, society's willingness to pay per unit is equal to the marginal cost of producing the good.
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The percentage change in quantity demanded of a good divided by the percentage change in income of the consumers gives the: a. price elasticity of demand of the good. b. price elasticity of supply of the good
c. income elasticity of demand of the good. d. income elasticity of supply of the good.
Which of the following qualify as part of our economy's capital income?
a. wages paid to workers b. interest paid to the owners of corporate bonds c. rent paid on farmland d. All of the above are correct.