If we know that the demand curve for good x fails to reflect the total value to society of that good, then we know that
a. the market for good x is characterized by an externality, but we cannot determine whether the externality is positive or negative from this fact alone.
b. the market for good x is characterized by a positive externality.
c. the market for good x is characterized by a negative externality.
d. the supply curve for good x fails to reflect the cost to society of producing that good.
b
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In an attempt to reduce poaching of elephant tusks for ivory, officials in Kenya burned illegally gathered ivory. Economists tend to point out that
A. poaching can be reduced with price supports for ivory. B. the supply of ivory has fallen, leading to an increase in price and reward for poaching. C. burning ivory decreases demand, leading to lower prices and reward for poaching. D. the demand for ivory is higher, leading to an increase in price and reward for poaching. E. burning ivory raises demand, and controlled prices will lead to even greater poaching.
Adam Smith believed that the goal of economic activity is to amass wealth in the form of gold, and that this could best be accomplished through government carefully using tariffs and quotas to fashion favorable terms of trade with its trading partners
a. True b. False Indicate whether the statement is true or false
Which of the following is not included in the M1 money stock?
a. money market funds b. demand deposits c. checking account deposits d. travelers' checks e. cash in the hands of the public
Both the marginal cost and the average variable cost curves are U-shaped. At the minimum point on the average variable cost curve, the marginal cost must be:
A. greater than the average variable cost. B. less than the average variable cost. C. equal to the average variable cost. D. at its minimum.