Suppose Frank likes to snack on sugary candy. Frank knows that it's bad for his teeth to eat sugary candy, but he doesn't care. Frank's snacking habits have no impact on anyone other than Frank. In this case, Frank's consumption of sugary candy generates:
A. a positive externality.
B. a negative externality.
C. neither a positive nor a negative externality.
D. both a positive and a negative externality.
Answer: C
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A) 0 B) 2 C) 3 D) 4
A net importer of assets must have a
a. current account deficit b. capital account deficit c. current account surplus d. capital account surplus e. balance of deficit trade
Explain what an economist means when he says, "You don't find any $10 bills on the sidewalk."
When the average variable cost curve is upward sloping, what must be true about the marginal cost curve?
A) It is U-shaped. B) It is above the average variable cost curve. C) It is upward-sloping. D) It is below the average variable cost curve. E) It is a straight line.