When comparing partial equilibrium effects to general equilibrium effects one can conclude that
A) general equilibrium effects are always larger.
B) partial equilibrium effects are always larger.
C) the effects are of equal size.
D) one cannot determine before the fact which effect is greater.
D
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A person acting as a supervisor as well as a residual claimant:
a. attempts to make value-maximizing investment decisions. b. aims to maximize a firm's sales. c. facilitates maximum investment in capital goods. d. reduces risk of opportunism.
A nations capital stock was valued at $500 billion at the start of the year and $575 billion at the end. Consumption of private fixed capital in the year was $35 billion. Assuming stable prices, net investment was:
A. $35 billion B. $40 billion C. $45 billion D. $75 billion
If the price elasticity of demand for a good is 0.8, then a
A) 1 percent rise in the price leads to a 0.8 percent decrease in the quantity demanded. B) one dollar rise in the price leads to a 0.8 percent decrease in the quantity demanded. C) 1 percent rise in the price leads to an 80 percent decrease in the quantity demanded. D) 1 percent rise in the price leads to an 8 percent decrease in the quantity demanded.
Which of the following activities, if any, represents an external benefit? a. The benefit to a consumer from consuming a Caesar salad
b. The damage to a person's health from secondhand smoke. c. The reduction in tourist revenues at a beach resort caused by an oil spill. d. None of the above