When what people pay does not necessarily reflect the real value they put on a good, it is likely that the:
A. good is nonrivalrous.
B. good is easily excludable.
C. free rider problem exists.
D. good will be oversupplied.
Answer: C
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If the Federal Reserve lowers the required reserve ratio, people will end up taking out ________ because the interest rates ________
A) more loans; will rise B) the same number of loans; will not change C) more loans; will fall D) fewer loans; will rise E) fewer loans; are controlled by the economic conditions alone
In reality, prices of non-renewable resources have not increased continually according to the model developed in Section 16.3 because of
A) abundance of the resource. B) technological progress changing marginal cost. C) changing market power of producers. D) All of the above.
The market for toothpaste is a good example of perfect competition
a. True b. False Indicate whether the statement is true or false
The act of discovering a new production process would be called
A. invention. B. innovation. C. investment. D. development.