If a good has an external cost, the
A) unregulated competitive market outcome is efficient.
B) marginal private cost reflects the external cost.
C) unregulated competitive market outcome is inefficient.
D) marginal social benefit is equal to the marginal social cost when the market is in equilibrium.
E) external benefit must equal the external cost.
C
You might also like to view...
Suppose the market for cement is such that the government does not interfere in price determination but plays an important role in the provision of property rights
While there are a large number of buyers and sellers, everyone conducts transactions at a common market price. Which of the following statements is true about the structure of the cement market? A) The cement market is government regulated. B) All participants in the cement market are price makers. C) All transactions in the cement market are likely to be involuntary. D) The cement market is free and competitive.
How is the gain from imports distributed between consumers and domestic producers?
What will be an ideal response?
If the money supply in the economy were at MS2, and the Federal Reserve Bank used open market operations to move money supply to MS3, the overall direct result in the economy would be:
A. Aggregate demand shifted in, causing GDP to fall.
B. Aggregate supply shifted in, causing GDP to fall.
C. Aggregate demand shifted out, causing GDP to rise
D. LRAS move to the FE level of output.
Which of the following is not an important source of revenue for the federal government?
A. Corporate income taxes. B. Property taxes. C. Payroll taxes. D. Personal income taxes.