In the above figure, what happens to the firm's optimal level of output if the price it receives for its product increases from P2 to P3?
A) Output stays the same.
B) Output decreases.
C) Output increases.
D) There is not enough information provided to know what happens to output.
C
Economics
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Which of the following will not cause aggregate private spending to decrease?
A) a reduction in expected future real interest rates B) a reduction in government spending C) an increase in future taxes D) all of the above E) none of the above
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The most common method used by the government to control negative externalities is
a. creation of private property rights b. obligatory controls c. taxation d. subsidization e. nationalization
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