The social cost of production, in cases where negative externalities exist, is equal to the
a. sum of private and external costs minus social benefit
b. sum of private and external costs
c. sum of private cost and external cost minus social benefit
d. sum of private cost and external cost
e. current market price plus the external cost
D
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In the above figure, a change in quantity demanded with unchanged demand is represented by a movement from
A) point a to point e. B) point a to point b. C) point a to point c. D) None of the above represent a change in the quantity demanded with an unchanged demand.
Homer has been saving to buy a new car in five years and expects that the car of his dreams will cost $35,000
If the interest rate is 8 percent per year, how much money should Homer have in his bank account today in order to have enough money to buy the car in 5 years? A) $1,852.28 B) $22,055.94 C) $23,820.41 D) $25,726.04
What is precautionary saving? What might cause precautionary saving to increase or decrease if households have a desired level of wealth?
What will be an ideal response?
Which of the following is a problem inherent in centrally planned economies?
A) Households and firms make poor decisions in choosing how resources are allocated. B) There is too little production of low-cost, high-quality goods and services. C) Production managers are more concerned with satisfying consumer wants than with satisfying government's orders. D) Exports tend to exceed imports.