"External benefits lead to overproduction so that more than the efficient quantity is produced." Is the previous statement true or false?
What will be an ideal response?
The statement is false. External benefits lead to underproduction so that less than the efficient quantity is produced.
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Decisions about how to allocate resources are made by:
A. individuals. B. businesses. C. governments. D. Decision about resource allocation are made by all of the above
A $100 billion increase in government purchases will have the same effect on real GDP as a $100billion decrease in net taxes
a. True b. False Indicate whether the statement is true or false
When making income comparisons across countries, economists generally prefer to use
a. the exchange rate conversion method. b. the consumer price index ratio method. c. the purchasing power parity method. d. the interest rate differential conversion method.
When we speak of expansionary fiscal policy, we are talking about policymakers __________ government spending, or __________ taxes, or both
A) decreasing; decreasing B) increasing; increasing C) increasing; decreasing D) decreasing; increasing