Question

33. Which of the following activities creates a negative extemality? a) Paying your taxes b) Driving during rush hour c) Planting a tree d) Eating an ice cream cone e) Giving a present to your friend 34. Which of the following activities creates a positive extemality? a) Emitting carbon dioxide b) Talking on your phone at the cinema c) Planting flowers in your front yard d) Polluting the water e) Playing loud music when your neighbor is sleeping 35. If an economy is on its production possibility frontier, then... a) the economy is not producing as much as it could.. b) technological progress is rapid. c) the economy is producing the best possible combination of goods d) the economy cannot produce more of any good without producing less of some other good. e) the economy can produce more of some good without producing less of any other good. 36. Which of the following will not shift out the production possibility frontier in the future? a) Technological progress b) Resource maintenance c) Consumption d) Investments in capital c) Investments in education 37. The circular flow diagram ignores... a) households selling labor to firms. b) households renting land to firms. c) households lending capital to firms. d) firms maintaining natural resources. e) firms selling goods and services to households. 38. Children are raised mostly within... a) firms. b) markets.