If the short-term own price elasticity for food is estimated to be ?0.4, then long-term own price elasticity is expected to be:

Assume that we want to drive our economy out of recession by generating a $400 billion change in real GDP. The MPC is 0.80 . Which of the following policy prescriptions would generate the targeted $400 billion change in income?

a. $120 billion increase in government spending and $50 billion increase in tax revenue. b. $140 billion increase in government spending and $70 billion increase in tax revenue. c. $160 billion increase in government spending and $120 billion increase in tax revenue. d. $220 billion increase in government spending and $100 billion increase in tax revenue. e. $400 billion increase in government spending and $300 billion increase in tax revenue.

An example of a negative externality is: a. the benefit you receive when your neighbor installs a smoke detector

b. the reduction in profits for your company that occurs when there is a decrease in consumer demand for the product you manufacture. c. the sleep you lose when your neighbor throws a loud party next door that keeps you awake. d. the change in the property values of your neighbors' homes when you paint your house and landscape your front yard