Microeconomics Homework - Essay Example

On the other hand, when the rate of increase in economic growth fell by 2%, rate of increase in airborne pollutants fell by only 1%. This indicates that the increase in the rate of airborne pollutants is higher when the rate of economic growth increases. On the other side, when the rate of increase in economic growth falls, the rate of airborne pollutants also fall but at a lower rate. b) The situation is inefficient since the consumers are not getting what they actually desire. Hence this is allocatively inefficient.

The cafeteria should allocate its resources towards producing roast turkey. d) The relationship between the tax rate and tax revenue when taxes are less than 80% is a direct one; hence the slope will be positive. The relationship between tax rate and tax revenue when taxes are greater than 80% is indirect and hence the slope will be