If the market equilibrium quantity is less than the socially optimal quantity, one can infer that:
A. the private demand curve for the activity is above the socially optimal demand.
B. the private supply curve for the activity is below the socially optimal supply curve.
C. there is a negative externality associated with this good.
D. there is a positive externality associated with this good.
Answer: D
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The self-interest model of government:
a. suggests that government officials are selfish. b. explains why there are limits on government taxation and spending. c. shows who some government projects take place even if the cost exceeds the benefits. d. All of the above.
Which of the following assertions, if proven true in a court of law, would help Archer-Daniels-Midland, a maker of corn syrup, in its attempt to acquire another corn syrup producer, the Clinton Corn Processing Company?
A) Archer-Daniels-Midland is a dominant producer of corn syrup. B) There are no good substitutes for corn syrup for any of its major uses. C) Archer-Daniels-Midland and the Clinton Corn Processing Company together hold only a small share of the market for sweeteners including corn syrup and sugar. D) Archer-Daniels-Midland produces many other different agricultural products, in addition to corn syrup.
Banks minimize the risk of loss to depositors by: a. lending to government officials
b. making many different loans to different borrowers. c. refusing to lend money to the U.S. government. d. lending to the richest 1 percent of the population. e. making very long-term loans.
Which of the following states the relationship between a bond's price and its yield?
a. As the price falls, the yield falls. b. Price and yield are usually independent of each other. c. As the price rises, the yield rises. d. As the price rises, the yield falls. e. As the yield rises, so does the price.