Nonexclusionary, as it relates to public goods, means that:
A. producer-consumer rivalry exists.
B. the government can only exclude consumers from consuming the good.
C. no producer can be excluded from providing the good.
D. no one can be excluded from consuming the good, once it is provided.
Answer: D
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A natural monopoly occurs when
A) one firm owns all the vital resources needed to produce a particular good. B) economies of scale allow one firm to supply the entire market at the lowest possible cost. C) a few firms collude to act as a single firm. D) one firm captures all the consumer surplus.
The economic value which can be created by a transaction between two people, Ed (seller) and Luis (buyer), is $50 as Ed's opportunity cost of selling is $135 and Luis' valuation of the good is $185 . If each gains $25 from this transaction, which of the following conclusions can be drawn?
a. Transaction costs are zero. b. Luis has higher bargaining power than Ed. c. Ed has higher bargaining power than Luis. d. Transaction costs are positive.
In Macroland, currency held by the public is 2,000 econs, bank reserves are 300 econs, and the required reserve/deposit ratio is 10 percent. If the Central Bank raises the required reserve/deposit ratio making the new desired ratio equal to 15 percent, then the money supply in Macroland will ________ to ________ econs, assuming that the public does not wish to change the amount of currency it holds.
A. decrease; 5,000 B. increase; 4,000 C. decrease; 4,000 D. increase; 5,000
The long-run Phillips curve shifts to the left or the right as expectations of inflation change.
Answer the following statement true (T) or false (F)