In which of the following externality situations would it be most likely that voluntary agreements could be used to internalize an externality?
A. littering on highways
B. trees of one neighbor blocking a view of another
C. overharvesting of alligators in Louisiana
D. poaching of elephants in Africa
Answer: B
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Refer to the above figure. As the real national income expands from Y2 to Y3,
A) tax revenues fall. B) a budget deficit occurs. C) government transfers rise. D) a budget surplus occurs.
The following are all final goods EXCEPT
A) flour used by the baker to make cupcakes. B) bread eaten by a family for lunch. C) pencils used by a 6th grader in class. D) Nike shoes used by a basketball player. E) a computer used by Intel to design new computer chips.
If the personal assets of the owners cannot be claimed if the business is bankrupt, the owners are said to have
A) a partnership type of business. B) unlimited liability. C) a proprietorship type of business. D) limited liability.
To an economist, utility means:
A) additional. B) usefulness. C) satisfaction. D) marginal.