Refer to the supply and demand graph below. In the graph, line S is the current supply of this product, while line S1 is the optimal supply from the society's perspective. One solution to this externality problem is to:
A. Give consumers a subsidy of the amount FG per unit
B. Give producers a subsidy of the amount AB per unit
C. Tax producers by the amount DE per unit
D. Tax consumers by the amount EF per unit
C. Tax producers by the amount DE per unit
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If the number of people classified as unemployed is 50,000 and the number of people classified as employed is 250,000, what is the unemployment rate?
(A) 16.17 percent (B) 8.7 percent (C) 11.5 percent (D) 8 percent
Which of the following explains why the marginal cost curve has a U shape?
A) Initially, the average cost of production rises, then falls. B) Initially, the marginal product of labor falls, then rises. C) Initially, the marginal product of labor rises, then falls. D) Initially, the average product of labor rises, then falls.