If trade opens up between the two formerly autarkic countries, Australia and Belgium, then
A) the real income of both countries may increase.
B) the real income of Australia and of Belgium will increase.
C) the real income of Australia but not of Belgium will increase.
D) the real income of neither country will increase.
E) the real income of both countries will increase.
A
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Ben's cost of making an additional rocking chair is $75
A) If he sells it for a $100, his producer surplus is $25. B) His marginal cost is equal to $75. C) The marginal benefit to the consumer from the chair will be $75. D) Both answers A and B are correct. E) Both answers B and C are correct.
The government wishes to close a recessionary gap by increasing national income by $700 billion. The MPC = 0.8 . Two policies are offered. Policy A calls for $180 billion in increased government spending and $50 billion in increased taxes. Policy B calls for $200 billion in increased government spending and $100 billion in increased taxes. Which of the following will increase the national income
by the desired $700 billion? a. Both policies increase national income by $700 billion but Policy B offers a lower budget deficit. b. Both policies increase national income by $700 billion and create equal budget deficits. c. Neither policy increases national income by $700 billion. d. Only Policy A increases national income by $700 billion. e. Only Policy B increases national income by $700 billion.