Which of the following is a major implication of the invisible hand concept?
What will be an ideal response?
When directed by competitive market prices, the actions of self-interested individuals will tend to promote overall economic prosperity.
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A positive externality exists and government wants to impose a subsidy in order to bring about an efficient outcome. To accomplish its objective, government must set the subsidy equal to marginal
A. private cost. B. social benefit. C. external cost. D. social cost. E. external benefit.
Revenue sharing is usually a means of
a. making states transfer money to the federal government. b. equalizing expenditures per pupil made by school districts. c. splitting the revenue earned from excise taxes between states and the federal government. d. making grants to state and local governments.
If tax revenues from a cigarette tax are used to pay for healthcare expenses related to lung cancer, the cigarette tax could be justified using the __________
Fill in the blank(s) with correct word
When a product is defined as homogeneous,
A. buyers prefer one seller's product to another's. B. buyers are indifferent as to which seller's product they buy. C. sellers are indifferent as to the quantity of the product they sell. D. sellers have an incentive to charge a price higher than the market price.