A positive externality occurs whenever:
a. an increase in the output of one firm lowers costs for other firms.
b. a decrease in the output of one firm lowers costs for other firms.
c. an increase in costs of one firm lowers costs for other firms.
d. a decrease in one firm's hiring of labor lowers labor costs for other firms.
Ans: a. an increase in the output of one firm lowers costs for other firms.
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Which of these is assumed to be constant along an aggregate supply curve?
a. The price level in an economy b. The exchange rate between the domestic and a foreign currency c. The state of technology used in production d. The unemployment rate e. The real GDP
Which of the following would be classified as consumption spending?
a. A family's purchase of a new home b. A family's purchase of a used car c. A family's payment for a child's hospitalization d. A family's purchase of Microsoft stock e. A family's purchase of a swing set for their home day-care business