An externality is the
A. secondary effect on an action
B. unintended consequence of an action
C. effect of an action on people or things that were not involved in the action
D. unknown consequence of an action on people or things who were primary parties in the action
Answer: C. effect of an action on people or things that were not involved in the action
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If the world price is below the domestic "no-trade" equilibrium price, then with international trade:
a. the domestic shortage can be eliminated by rationing. b. the domestic surplus can be consumed at home. c. the domestic surplus can be exported to the rest of the world. d. the domestic quantity demanded is equal to that supplied by the world. e. the domestic shortage can be met by foreign imports.
What statement about the savings and loan crisis of the 1980s is true?
a. Many savings and loan depositors lost their entire savings. b. A combination of deposit insurance and deregulation had encouraged savings and loans to take risks. c. Depositors panicked and made runs on the savings and loans, which had a waterfall effect. d. Savings and loans had to pay about $150 billion to cover their financial losses.
In the study conducted by Miles Corak, which of the following countries had the strongest relationship between parental and child income?
A. France B. United States C. United Kingdom D. Denmark
Firms in long-run perfect competition produce at
A) increasing returns to scale. B) decreasing returns to scale. C) constant returns to scale. D) no returns to scale.