In the presence of ________ externalities, too much of the good is produced and in the presence of ________ externalities, too little of the good is produced.
A. positive; negative
B. positive; no
C. negative; positive
D. no; negative
Answer: C
You might also like to view...
In 1960, national defense comprised about _____ of federal government expenditures
a. one quarter b. one-third c. one half d. two-thirds
Without any regulation, the natural monopolist will
A) not produce any output. B) produce to the point at which P = ATC. C) produce less output than it would if the industry was purely competitive. D) have an upward-shifting average cost curve.
A perfectly competitive firm will always maximize profits by producing where
A. per-unit costs are lowest. B. total costs and total revenue are equal. C. P = MC. D. P = AC.
The rules-based monetary policy that some nonactivists have proposed to maintain price stability reads this way:
A) The annual growth rate in the money supply will equal the average annual growth rate in Real GDP minus the growth rate in velocity. B) The annual growth rate in the money supply will equal the average annual growth rate in Real GDP plus the growth rate in velocity. C) The annual growth rate in the money supply will equal the average annual growth rate in Real GDP divided by the growth rate in velocity. D) The annual growth rate in the money supply will equal the average annual growth rate in Real GDP times the growth rate in velocity.