A large employer gives each new hire an aptitude test, which is scored from 1 to 20. Let T be a worker's score on the test. The firm then pays a new worker a wage of w = 0.6T + 0.4G where G is the average test score for the worker's gender: 16 for women; 12 for men. How much more is a woman paid than a man when both scored a 10 on the test?

A recession shows

A) supply always equals demand. B) supply never equals demand. C) thousands of businesspeople have misread market signals. D) real GDP must be lower than nominal GDP. E) not enough households are using their credit cards.

If a Pigovian tax is too large, the resulting:

A. outcome will not maximize surplus. B. quantity will be too high. C. outcome will still be efficient. D. All of these statements are true.