The existence of public goods can be a source of market failure.
Answer the following statement true (T) or false (F)
True
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Everything else equal, the more rivals a firm has, the
a. less kinked is its demand curve. b. closer is its equilibrium price to its average variable costs. c. more differentiated is its product from rivals' products. d. more elastic is its demand curve.
Complements
What will be an ideal response?
Firms are likely to prefer a pollution tax to a command-and-control policy because the command-and-control policy will:
A. increase the costs of production more than a pollution tax. B. result in the price of the good rising more than under a pollution tax. C. result in consumers buying less of the good than under a pollution tax. D. All of these
A large "T-statistic" tell us that
A) a tiny change in the independent variable will cause a relatively large change in the dependent variable. B) we do not have enough data to obtain an accurate regression line. C) we can be confident that our estimated coefficient is not zero. D) we should have included more "lags" in our model. E) we have incorrectly switched the dependent and independent variables in our model.