There is an externality present only when
A) private costs equal social benefits.
B) private benefits equal social benefits.
C) private costs or benefits diverge from social costs or benefits.
D) private costs equal social costs.
Answer: C
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A merger between a shoelace company and a soup company might be undertaken to
a. eliminate a potential competitor b. enhance a supplier-purchaser relationship c. diversify assets and production d. raise the Herfindahl-Hirschman Index in the shoelace industry e. raise the concentration ratio in the soup industry
If output Q = 8.5e (e = units of effort) and Wage, W = $6.70 + 0.25Q, then 20 units of effort are worth ________ to the firm.
A. $0.425 B. $35.80 C. $49.20 D. $170.00
Usury laws are popular with ________.
A. the public and with economists B. the public, but not with economists C. economists, but not with public D. neither the public nor with economists
Of the collection of supply and demand diagrams in Figure 2.2, which one shows the result of a decrease in income if a good is considered inferior?
A. Figure 1 B. Figure 2 C. Figure 3 D. Figure 4