Fireworks would be considered:
A. a private good.
B. a public good.
C. an artificially scarce good.
D. a common resource.
Answer: B
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Which of the following is inconsistent with the model of perfect competition?
a. ease of entry into an industry b. ease of exit from an industry c. many buyers and sellers in the industry d. advertising of product differences in the industry e. a horizontal demand curve facing each firm in the industry
For a linear demand curve, where is the amount of total expenditures on a good maximized?
What will be an ideal response?
Under competition, the price of a resource reveals
a. information about the past, but not future, uses of a resource. b. the most valuable way to use the resource. c. how much the resource is worth in the most valuable of its alternative uses. d. the value of the labor needed to fully exploit the resource.
Answer the following statement(s) true (T) or false (F)
1. A non-congested toll road is an example of a good that is excludable, but not rivalrous in consumption. 2. Public goods can frequently be provided by private action when the resulting benefits are widespread. 3. All economists agree that a public good is one the is nonrivalrous and nonexcludable. 4. When a public goods increases the desirability of living in a certain area, benefits tend to be captured entirely by an increase in land values. 5. In a Clarke tax scheme, the amount of tax that a person pays depends, in part, on his revealed preference for the public good.