A positive externality is created if:
A. an action harms someone not involved in the market transaction.
B. an action benefits someone not involved in the market transaction.
C. neither helps nor hurts someone not involved in the market transaction.
D. an action harms or benefits someone not involved in the market transaction.
B. an action benefits someone not involved in the market transaction.
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Devastating damage resulting from a major earthquake and tsunami will most likely
A) initially move a country to a time path beneath its balanced growth path. B) move a country to a lower point on its balanced growth path. C) shift the balanced growth path for a country to a new, lower level. D) have little to no impact on the short-term growth rate in a country.
According to the classical theory, a contractionary monetary policy ________ the price level and ________ output in the long run.
A. doesn't change; doesn't change B. decreases; doesn't change C. decreases; increases D. increases; increases