When the benefits of producing a good or service spill over to other people, rather than just the buyer, the spillover is referred to as

Suppose there are two policy options facing a vote in the Senate. In the first, government spending will increase $50 billion, while the second option is to cut taxes by $50 billion. A Keynesian economist would argue for

A) the spending option because it has a bigger impact on total spending. The spending directly raises total spending plus it works through the multiplier, while the tax cut only works through the multiplier. B) the tax option because it is easier to pass. The effects on total spending would be identical. C) the spending option because it won't affect the deficit the way the tax cut would. D) the tax option because it also affects the incentives workers face. Long-run aggregate supply will increase with the tax cut, but not with the spending increase.

Refer to the table above. Diminishing marginal returns sets in when:

A) the second worker is hired. B) the fourth worker is hired. C) the fifth worker is hired. D) the seventh worker is hired.