The existence of positive externalities in the consumption of a good implies that:
a. the social supply curve of the good lies to the right of the private supply curve
b. the government will need to provide subsidies to ensure a socially efficient level of consumption.
c. the socially efficient quantity of the good will be less than the market equilibrium quantity.
d. the good generates an external cost.
e. the market equilibrium price of the good will be greater than the social equilibrium price.
b
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Banks decide to raise the interest rate they pay on checking accounts from 1% to 2%. This action would
A) increase money demand, shifting the LM curve up and to the left. B) increase money demand, shifting the LM curve down and to the right. C) decrease money demand, shifting the LM curve up and to the left. D) decrease money demand, shifting the LM curve down and to the right.
Refer to the above payoff matrix for the profits (in $ millions) of two firms (X and Y) making a decision to advertise or not. Which of the following is the outcome of the dominant strategy without cooperation?
A) Both firm X and firm Y choose not to advertise. B) Both firm X and firm Y choose to advertise. C) Firm X chooses to advertise while firm Y chooses not to advertise. D) Firm X chooses not to advertise while firm Y chooses to advertise.
Refer to the information provided in Figure 8.4 below to answer the question(s) that follow. 
Figure 8.4 Refer to Figure 8.4. If twelve microwave ovens are produced, Micro Oven's total fixed costs are
A. $25. B. $41.67. C. $50. D. $300.
The central bank which is generally regarded as the most independent in the world because its charter cannot be changed by legislation is the
A) Bank of England. B) Bank of Canada. C) European Central Bank. D) Bank of Japan.