A good economic theory is always more useful when it includes detailed facts, even if the facts are not relevant to the questions being investigated

In Figure 11.1, a decrease in the marginal propensity to save is represented by a change in the consumption function from

A) C1 to C3. B) C3 to C1. C) C2 to C1. D) C1 to C2.

If a good is produced by firms that incur all private and external costs, the price consumers pay

A) will be efficient since it includes all social costs. B) will not be socially acceptable. C) will be too high because the consumers end up paying all of the costs instead of the firm. D) will be the correct price, but inefficient.