When an external cost exists that is NOT taken into account in the production of a product,
A) the level of output is too low, and the supply curve should shift to the right to account for the externality.
B) the level of output is optimal, and there should be no change in the supply curve.
C) the price of the product is too high, and production should be expanded to lower the price.
D) the level of output is too high, and the supply curve should shift to the left to account for the externality.
Answer: D
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The table above has information about the CPI, nominal wage rate, and nominal interest rate for the country of Syldavia for the years 2010 to 2012. The reference base year is 2010. The inflation rate in Syldavia from 2010 to 2011 was
A) 5.0 percent. B) -9.5 percent. C) 3.0 percent. D) 9.5 percent. E) -5.0 percent.
How are TIPS adjusted for inflation?
A) The interest rate is adjusted for inflation during each period. B) The principal is adjusted once the bond reaches maturity. C) The principal is adjusted for inflation each period. D) The interest rate is adjusted once the bond reaches maturity.
If the government decreased urban welfare payments by a dollar for every dollar increase in farm subsidies, which of the following is the likely net effect?
a. An increase in the budget deficit because government spending has increased b. A decrease in the budget deficit because transfer payments are not included in the government's budget c. An increase in the budget deficit because transfer payments have increased d. An increase in the budget deficit because farm subsidies are transfer payments but urban welfare payments are not e. No change in the budget deficit
The horizontal axis on the aggregate demand-aggregate supply model measures
a. the price of the specific product produced. b. the level of total output. c. the price level. d. the level of employment.