If an externality is present in a market, economic efficiency may be enhanced by
a. government intervention.
b. a decrease in foreign competition.
c. fewer market participants.
d. weaker property rights.
a
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Suppose your grandfather earned a salary of $12,000 in 1964. If the CPI is 31 in 1964 and 219 in 2016, then the value of your grandfather's salary in 2016 dollars is approximately
A) $84,775. B) $63,830. C) $37,200. D) $26,280.
Suppose that the demand for labor decreases due to an economic downturn, and union workers are in the first year of a 3-year labor contract
With respect to these union laborers, the economic downturn will most likely ________ the nominal wage and ________ the quantity of labor hired. A) decrease; not change B) decrease; decrease C) not change; decrease D) not change; not change
Suppose a competitive market is comprised of firms that face identical cost curves. The firms experience an increase in demand that results in positive profits for the firms. Which of the following events are then most likely to occur? (i) New firms will enter the market. (ii) In the short run, price will rise; in the long run, price will rise further. (iii) In the long run, all firms will be
producing at their efficient scale. a. (i) and (ii) only b. (i) and (iii) only c. (ii) and (iii) only d. (i), (ii) and (iii)
At a price of $9.99, Danielle buys 3 digital books per month. When the price decreases to $7.99, Danielle buys 4 digital books per month. Jason says that Danielle's demand for digital books has increased. Is Jason correct?
A) Yes, Jason is correct. B) No, Jason is incorrect. Danielle's demand has decreased. C) No, Jason is incorrect. Danielle's quantity demanded has decreased, but her demand has stayed the same. D) No, Jason is incorrect. Danielle's quantity demanded has increased, but her demand has stayed the same. E) No, Jason is incorrect. Danielle's quantity demanded has increased and her demand has decreased.