An increase in the desire to save by households will cause
A) a reduction in output.
B) a reduction in investment.
C) an increase in output.
D) no change in investment and no change in output.
A
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When the government uses a private subsidy in a market with an external benefit, to reach the efficient quantity of production, the subsidy must be equal to the marginal
A) social benefit. B) cost of production. C) private benefit. D) external benefit. E) external cost.
Which of the following is not an example of De Beers Diamonds trying to increase consumer demand?
a. sending the marketing message that a diamond lasts forever b. ads that illustrate that a diamond should remain in the family and not be sold c. informing potential customers about how diamonds lose monetary value over time d. introducing the idea of the diamond engagement ring e. the "spirit ring" as a sign of independence