Figure 4-12
Refer to . The exhibit illustrates the impact of granting a subsidy on a particular good. Which of the following is true for this subsidy given the information provided in the exhibit?
a.
The subsidy has been statutorily (legally) paid to buyers.
b.
The subsidy results in an increase in the selling price of the good.
c.
Sellers will receive a larger proportion of the benefit from this subsidy than buyers.
d.
All of the above are true.
d
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Using the data in the above table, what is the marginal product of the second worker?
A) 4.5 pizzas per hour B) 4 pizzas per hour C) 5 pizzas per hour D) The marginal product is undefined.
According to Professor Baotai Wang who examined the crowding out phenomenon in Canada between 1961-2000, as discussed in the Case in Point, expenditures for protection of persons and property
A) involve no crowding out. B) may involve some crowding out, but they also stimulated private investment by firms winning government contracts for defense purchases. C) stimulate aggregate demand and aggregate supply. D) may involve some crowding out, which is offset by the strong supply-side effects they generate.