With positive externalities, _____
a. the market equilibrium occurs at a lesser quantity than the socially optimal output
b. the market equilibrium occurs at a greater quantity than the socially optimal output
c. the social benefit curve lies below the private benefit curve
d. there is no deadweight loss
a
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Economists assume that rational behavior is useful in explaining choices people make
A) because irrational people do not make economic choices. B) because individuals act rationally all the time in all circumstances. C) even though people rarely, if ever, behave in a rational manner. D) even though people may not behave rationally all the time.
If the quantity demanded for a good rises as income rises then the income elasticity of demand for this good is ________ than 0, and the good is ________ good
A) less; an inferior B) less; a normal C) greater; a normal D) greater; an inferior
If nominal GDP rises from $5 billion to $6 billion, when the GDP deflator goes from 100 to 110, real GDP a. rises
b. falls. c. stays the same. d. could either be rising or falling.
The millions of taxpayers who must pay for a federal government bail-out of the financial giant AIG will not be well represented at the hearings on the issue, because
What will be an ideal response?