What is the difference between private and social costs?
Social costs are those that accrue to the total population; private costs refer to those costs incurred only by the producer or consumer of the good or service.
You might also like to view...
The simple quantity theory of money predicts that changes in
A) the money supply lead to strictly proportional changes in the price level. B) the money supply do not affect the price level. C) the price level lead to strictly proportional changes in velocity and GDP. D) velocity lead to nearly proportional changes in the money supply.
Answer the following questions true (T) or false (F)
1. An appropriate fiscal policy response when aggregate demand is growing at a faster rate than aggregate supply is to decrease the money supply. 2. To complement actions by the Fed to reduce inflation, Congress and the President can cut spending and/or raise taxes. 3. The multiplier effect following an increase in expenditure is generated by induced increases in consumption expenditure as income rises.