1.According to new classical economists, why should welfare benefits for the unemployed and single parents be decreased?
2.Based on the Laffer curve concept, how does tax revenue change as tax rates rise?
3.According to supply-side economists, what is the expected outcome when tax reductions encourage individuals to work more and businesses to invest more?
4.Which group of economists contends that excessive taxes and stringent regulations diminish the motivation to work, save, and invest, thereby harming the economy?
5.When a market produces an externality, how effective are free market solutions?
6.When a producer possesses market power and can affect the product's price, how do free market outcomes typically perform?
7.Assuming buyers act rationally and there is no market failure, what can be said about free market outcomes?
8.According to Adam Smith's concept of the invisible hand, what is the result of a competitive market equilibrium?
9.If a new bicycle is priced at Rs 300, Natalie values it at Rs 400, and the production cost for the seller is Rs 200, what is the total surplus when Natalie purchases the bicycle?
10.What does the seller’s cost of production represent?
11.What happens if a well-intentioned social planner decides to produce less than the market equilibrium quantity of a good?
12.Which area represents the producer surplus on a supply and demand graph?
13.What is the effect on consumer surplus when the price of a product rises, assuming the demand curve remains unchanged?
14.What does a buyer's willingness to pay represent?
15.Jamil owns ten pairs of football boots while Saleem has none. The production cost for one pair of boots is Rs 50. Jamil values an extra pair at Rs 100, whereas Saleem values a pair at Rs 40. According to efficiency principles, who should be allocated an additional pair of boots?
16.Medical treatment improves individuals' well-being. Up to what point should we continue using medical services?
17.What is true about a market when it is considered efficient?
18.Typically, if a well-intentioned social planner aims to maximize the combined benefits for both buyers and sellers in a market, what approach should they take?
19.What is the effect of a price rise for a product when the supply curve remains unchanged?
20.Which area represents the total surplus in a market?