One reason the supply of carpenters is greater than the supply of physicians is because:
A. carpenters demand less income.
B. physicians do not belong to a union.
C. of differences in human capital.
D. carpenters belong to unions.
Answer: C
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Giving up consumption today for consumption tomorrow accelerates economic growth by
A) having the economy produce no consumer goods. B) increasing saving out of disposable income. C) increasing the expected rate of inflation. D) rapid expansion of the money supply.
Suppose planting flowering shrubs creates a positive externality equal to $7 per shrub. Further suppose that the local government offers a $7 per-shrub subsidy to planters. The number of shrubs that are planted is then
a. less than the socially optimal quantity. b. greater than the socially optimal quantity. c. equal to the socially optimal quantity. d. There is not enough information to answer the question.