Hank's Honey is a bee farm out in the country. Kid Kare Nursery School is next door. Fleurette's fruit orchard is located on the other side of the school. Hank's bees, searching for nectar, buzz by the nursery school to feed in Fleurette's orchard and in doing so, pollinate the fruit. The school children, however, fear the bees. Who benefits in this story?
a. Hank and Fleurette
b. Kid Kare
c. Hank only
d. Fleurette only
e. no one benefits, but Kid Kare loses
A
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A firm selling a good which lacks any good substitutes is called a(n)
a. pure monopoly. b. price discriminator. c. exclusive monopoly. d. natural monopoly.
Refer to the graph shown which shows total product. At point B:
A. marginal product is at its minimum. B. marginal product is zero. C. marginal product is at its maximum. D. average product is at its maximum.
If a consumer is at an optimum, consuming X and Y, and the price of Y increases, then to get to a new equilibrium the consumer must
A. purchase more of both X and Y. B. purchase more X. C. purchase less X. D. purchase less of both X and Y.
Refer to Figure 28.2. Assume this firm initially has marginal costs equal to Private MC1. If this firm is producing a product that does not generate any externalities, the allocatively efficient output would occur where
A. Price = MC1. B. Price = MC2. C. Price = MC3. D. Price = MC1 plus social MC.