In the short run, average variable cost is always less than average total cost

A fall in autonomous investment will shift the

a. IS curve to the right toward higher interest rates and output. b. LM curve to the right towards lower interest rates and higher output. c. IS curve to the left towards higher interest rates and output. d. None of the above

Suppose that candy producers create a positive externality equal to $1 per pound of candy. Further suppose that the government offers a $1-per-pound subsidy to the producers. What is the relationship between the equilibrium quantity and the socially optimal quantity of candy?

a. The equilibrium quantity is greater than the socially optimal quantity. b. The equilibrium quantity is less than the socially optimal quantity. c. They are equal. d. There is not enough information to answer the question.