Refer to Figure 6.6, which shows a market for taxi medallions. If the number of taxi licenses is reduced from Q2 to Q1, the total surplus of the market is represented by:

When the government's outlays exceed its tax revenues, the national debt

A) shrinks thanks to the budget surplus. B) grows to finance the budget deficit. C) grows to finance the budget surplus. D) shrinks thanks to the budget deficit. E) does not change because it has nothing to do with government outlays and tax revenue.

A production possibilities curve shows the relationship between:

A) the price of a good and its quantity supplied. B) the maximum production of one good for a given level of production of another good. C) the different combinations of two inputs used to produce a given quantity of output. D) the quantity of output produced and the amount of inputs required for the production of the output.