An external cost is created when you
A) buy a sandwich for lunch. B) litter on the side of the road.
C) graduate from college. D) buy flowers for your mother on Mother's Day.
B
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In the Keynesian model in the short run, a decrease in the money supply will cause
A) a decrease in output and an increase in the real interest rate. B) an increase in the real interest rate but no change in output. C) a decrease in the real interest rate and a decrease in output. D) no change in either the real interest rate or output.
Which of the following most directly reflects the law of diminishing marginal utility?
a. After watching two football games, Terry decides to watch a third game. b. A sports fan enjoys watching Monday night football rather than going to the theater. c. After listening to three compact discs, Kim decides to go bowling rather than listen to a fourth disc. d. A musician receives the biggest ovation of the evening after playing the final number of a recital.