When the production or consumption of a good involves an externality:
a. resources are necessarily overallocated to the good
b. resources are necessarily underallocated to the good.
c. someone not involved in buying or selling the good is affected.
d. the market will efficiently allocate resources to its production.
c
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Use the information in the table below.Total salesIndustry 1Firm 1$5.3mFirm 2$199,000Firm 3$2.6mFirm 4$850,000What percent of total sales does Firm 1 make up in Industry 1?
A. 89% B. 53% C. 59% D. 25%
State and local governments rely on ________ as their primary source of tax receipts
A) personal taxes B) contributions for social insurance C) indirect business taxes D) corporate taxes
A normal profit is
A) revenues minus opportunity cost of zero. B) revenues minus accounting cost of zero. C) a zero accounting profit. D) revenues minus accounting and opportunity cost of zero.
As national income rises,
A) water problems are eliminated. B) infant mortality falls. C) emissions from fossil fuels decrease. D) depletion of forest reserves increases at an increasing rate.