Suppose a Country Imposes New Restrictions on How Many Hours

question 133

Multiple Choice

Suppose a country imposes new restrictions on how many hours people can work.If these restrictions reduce the total number of hours worked in the economy,but all other factors that determine output are held fixed,then

• A)productivity and output both rise.
• B)productivity rises and output falls.
• C)productivity falls and output rises.
• D)productivity and output fall.

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Definitions:

Marginal Social Benefit

The additional benefit to society as a whole from the consumption of one more unit of a good or service.

Marginal Social Cost

The additional cost incurred by society as a whole due to producing one more unit of a good or service.

Pollution

The contamination of the natural environment, leading to adverse effects on ecosystems and human health.

Marginal Social Cost

The extra expense society incurs from the production of an additional unit of a good or service.