Do policy makers know the level of unemployment that is associated with “full employment”?
A. Yes, economists have the precise level of unemployment that is full employment.
B. Yes, although there is a small range of uncertainty in this measure.
C. No, economists have no idea what this level of unemployment is.
D. No, this number is not known with complete accuracy.
Answer: D
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A reduction in the number of farms in the United States has caused food production to fall
Indicate whether the statement is true or false
If there are external or spillover benefits associated with consumption and production of a product, it can be said that the:
A. government should consider prohibiting the production of the commodity. B. demand curve understates the total benefit from the product and resources are underallocated to its production. C. government should consider placing a special tax on producers. D. supply curve for the product lies too far to the right to provide an efficient allocation of resources.