The Coase theorem reminds us that efficiency is all about ________ and says nothing about ________.
A. who gets the most surplus; whether that's a fair outcome
B. maximizing total surplus; the distribution of that surplus
C. equitably distributing surplus; maximizing that surplus
D. None of these statements is true.
Answer: B
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The tragedy of the commons is the absence of incentives to
A) correctly measure the marginal social benefit from a common resource. B) prevent under use of the common resource. C) prevent overuse and depletion of a common resource. D) discover the common resource.
According to the Keynesian view, the rapid increase in government spending and large budget deficits in response to the recession of 2008-2009 would
a. slow the recovery process and result in weak long-term growth of real GDP. b. speed the recovery process and provide the foundation for strong long-term growth of real GDP. c. stimulate a more rapid recovery, but cause the economy to fall back into a recession in the near future. d. slow the recovery process, but provide the foundation for rapid long-term growth of real GDP.
Changes in general economic conditions usually produce:
A. lower risk premiums. B. risk reduction. C. idiosyncratic risk. D. systematic risk.
According to the above figure, what are the profits of the firm if it produces 50,000 units?
A. -$5,000 per day B. -$17,500 per day C. -$10,000 per day D. -$7,500 per day