Traffic congestion is an example of a negative externality because
A) motorists take into account all benefits while driving.
B) motorists take into account all costs while driving.
C) a motorist's cost of driving spills over and affects other motorists.
D) a motorist's benefit from driving spills over and affects other motorists.
C
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Which of the following statements regarding U.S. economic growth is NOT correct?
A) Over the past 100 years, on the average real GDP per person grew 2 percent a year. B) The average annual growth rate of real GDP per person in the United States was rapid during World War II. C) In the 1930s, real GDP fell well below its trend. D) The growth rate of real GDP per person accelerated between 1973 to 1984.
The long-run aggregate supply curve is the relationship between the quantity of real GDP supplied and ________ when ________
A) the price level; real GDP equals potential GDP B) real GDP demanded; the wage rate is constant C) the price level; real GDP equals nominal GDP D) real GDP demanded; the price level does not change