Market failure associated with the free-rider problem is a result of
a. a problem associated with pollution.
b. benefits that accrue to those who don't pay.
c. losses that accrue to providers of the product.
d. market power.
b
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Suppose the economy in the diagram below is in long-run equilibrium. If government spending decreases and causes a movement from point A to point B in the diagram below, what are the short-run effects? Explain fully
What will be an ideal response?
Along a perfectly elastic demand curve,
A. the slope is always zero. B. the price elasticity of demand is 1. C. consumer purchases will not respond at all to a change in price. D. All of the responses are correct..
The problem of special interests financing congressional campaigns and presidential elections is associated with
a. government failure b. public choice theory c. market failure d. negative externalities e. government subsidies
During the course of a bad recession the Fed would probably be doing each of the following, except
A. selling securities on the open market. B. lowering interest rates. C. lowering reserve requirements. D. lowering the discount rate.