Total net benefits gained in a market
a. minus any side payments equals total revenue from producing the good (or, equivalently, total expenditure on the good)
b. is the sum of producer and consumer surplus in that market
c. is the difference between consumer surplus and producer surplus in that market
d. are maximized when the market price equals zero
e. always exceeds the sum of total expenditure on the good and the total cost of providing it
B
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A decrease in taxes will have no effect on real GDP if
A) the tax decrease is offset by an increase in government spending. B) people look at changes in taxes only in the present. C) the Ricardian equivalence theorem holds. D) there is no crowding out.
If prices of a nation's exported products rise in comparison to prices paid for imports, that nation experiences a:
a. rise in its international terms of trade. b. decline in its international terms of trade. c. reduction in its imports. d. reduction in its exports.