Suppose that one firm produces a product that results in negative external costs to society. This information suggests that
A. at the market price, quantity demanded is less than quantity supplied.
B. the equilibrium market price of the product includes the external costs borne by society.
C. resources are under-allocated to the firm.
D. resources are over-allocated to the firm.
Answer: D
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Most nations do not push the rate of economic growth to the maximum because
a. it would be impossible to do so b. they do not know how to do so c. there is an opportunity cost associated with economic growth d. maximum growth would create an inefficient economy e. government budget deficits prevent them from doing so
Figure 5.4 shows a firm's marginal cost, average total cost, and average variable cost curves. At Q = 50, the total variable cost is:
A. $1,200. B. $1,500. C. $2,100. D. $2,800.
Refer to Figure 13A.1. When the economy reaches K:
A. depreciation equals saving. B. depreciation is zero. C. capital stock increases. D. economic growth through capital deepening continues to increase.
Between 1995 and 2007 in the United States:
A. average U.S. household wealth increased and median household wealth declined. B. average U.S. household wealth declined and median household wealth increased. C. both average and median U.S. household wealth declined. D. both average and median U.S. household wealth increased.