Firms that are involved in more than one type of business could be evidence of an attempt to
a. increase private profit at the expense of consumers.
b. internalize some forms of positive externalities.
c. reduce the impact of government regulations on their business.
d. increase the private marginal cost of production.
b
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If Veronica withdraws $1,500 from her savings account and deposits it in her checking account, then M1 will ________ and M2 will ________
A) increase; decrease B) increase; not change C) not change; decrease D) not change; not change
The capture theory of regulation implies that
A) regulations promote the attainment of efficiency. B) regulations promote the attainment of economic profit. C) public officials favor voters over producers. D) the demand for regulation is less elastic than the supply.
Refer to Figure 15-17. An economics professor argues: "I think the course should be priced so as to achieve economic efficiency." How much profit (or loss) will the college make on the course if it charges this price?
A) -$2,592,000 B) -$1,080,000 C) $0 D) $450,000
Who gains surplus when consumers in a market are given a Pigouvian subsidy for a positive externality?
A. Consumers B. Producers C. Others affected by the externality D. Both consumers and producers gain surplus.