Refer to the diagram of the market for product X. Curve St embodies all costs (including externalities), and Dt embodies all benefits (including externalities) associated with the production and consumption of X. Assuming the market equilibrium output is Q1, we can conclude that the existence of external
A. benefits has resulted in an underallocation of resources to X.
B. costs has resulted in an underallocation of resources to X.
C. benefits has resulted in an overallocation of resources to X.
D. costs has resulted in an overallocation of resources to X.
Answer: A. benefits has resulted in an underallocation of resources to X.
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A) systematic B) nonsystematic C) portfolio D) investment
When the U.S. dollar depreciates in relation to the Swiss franc:
a. a U.S. importer will need more dollars to pay for an invoice denominated in Swiss francs. b. a Swiss exporter will receive more Swiss francs for an invoice denominated in the exporter's currency. c. Swiss imports of U.S. goods will fall. d. the Swiss franc is now worth less in terms of the U.S. dollar. e. a U.S. exporter will receive fewer dollars for an invoice denominated in Swiss francs.
Which one of the following decisions most clearly reflects a lack of understanding of the concept of sunk costs?
a. You pay to have your car towed back to the repair shop because it was not fixed properly the first time. b. You decide to get a master's degree because you cannot find a job in the field in which you majored. c. You decide to purchase a piece of machinery for your business that will eliminate three employees' positions. d. You study eight hours for a final exam even though there is no way now that you can pass the course.
The effect of legislation establishing a minimum wage above the market clearing wage is
A) unemployment. B) a shortage of labor. C) higher wages for all workers. D) a shift of the demand for labor curve.