Externalities arise when:
a. the benefits of a transaction between producers and consumers are enjoyed by only the consumers.
b. the benefits of a transaction between producers and consumers are enjoyed by only the producers.
c. a transaction negatively impacts people who are not directly involved in the transaction

In the money market, if the interest rate exceeds the equilibrium interest, there is a surplus of money. How is the surplus eliminated?

A) People buy bonds to rid themselves of the surplus money, bidding up their price and pushing interest rates down. B) Banks will lend out the surplus, lowering interest rates. C) The Federal Reserve will destroy currency, reducing the quantity of money. D) The high interest rate increases the demand for money, eliminating the surplus.

The bulk of federal receipts come from

A) property taxes and personal income tax. B) personal income tax and from payroll taxes. C) corporate income taxes and personal income tax. D) personal income tax and property taxes.