Making a Choice at the Margin Means

question 40

Multiple Choice

Making a choice at the margin means

• A) letting someone else choose for you.
• B) waiting until the last minute to make a choice.
• C) deciding to do a little bit more or a little bit less of an activity.
• D) making a choice by comparing the total benefit and the total cost.

Understand the concepts of equilibrium GDP, recessionary gaps, inflationary gaps, and their indicators.

Analyze the relationship between economic growth, government budget deficits/surpluses, and the national debt.

Comprehend the role and impact of automatic stabilizers in smoothing out economic cycles.

Understand the implications of government borrowing and the crowding-out effect in fiscal policy.

---

Definitions:

Bushels

A unit of volume that is used primarily in the United States to measure agricultural produce, such as grains, fruits, and nuts.

Pecks

A traditional unit of volume used for dry goods, equivalent to approximately 9 liters or a quarter of a bushel.

Demand Function

A mathematical formula representing the relationship between the quantity of a good consumers are willing to buy and the price of the good, alongside other factors like income and the prices of related goods.

Total Revenue

The total income generated from the sale of goods or services before any costs are subtracted.