It is true of externalities that they
a. are always detrimental.
b. are always beneficial.
c. arise when all costs, social and private, are included in production cost.
d. cause the price system to misallocate resources.
d
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The figure above shows the production possibilities frontiers for four nations that have identical production possibilities frontiers in the present. The one that will grow most rapidly in the future is most likely to be producing at point
A) A. B) B. C) C. D) D.
The originate-to-distribute business model has a serious ________ problem since the mortgage broker has little incentive to make sure that the mortgagee is a good credit risk
A) principal-agent B) debt deflation C) democratization of credit D) collateralized debt
Positive analysis can be described as
A) the study of whether people respond to positive incentives. B) the study of whether people respond to negative incentives. C) a value-free approach to inquiry. D) a study that is not tested empirically.
If an individual's supply of labor curve is positively sloped throughout, then:
a. the substitution effect always dominates the income effect. b. the income effect always dominates the substitution effect. c. the substitution effect dominates at low real wage levels and the income effect dominates at high real wage levels. d. the income effect dominates at low real wage levels and the substitution effect dominates at high real wage levels.