In the presence of a negative externality
a. the market marginal benefit curve lies above the market supply curve
b. a market will produce less than the efficient quantity
c. the market price will be too high for an efficient solution to exist
d. the marginal social cost curve lies above the market supply curve
e. Pareto optimality is automatically guaranteed
A
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If the price of a movie ticket increases by 4 percent and the quantity of movies demanded falls by 2 percent, the price elasticity of demand is
A) 2.0. B) 4.0. C) 0.5. D) some amount that cannot be determined without more information.
In recording an accounting transaction in a double-entry system
A. the number of debit accounts must equal the number of credit accounts. B. there must only be two accounts affected by any transaction. C. there must always be entries made on both sides of the accounting equation. D. the amount of the debits must equal the amount of the credits.
The minimum amount that investors must earn on the funds they invest in a firm, expressed as a percentage of the amount invested, is referred to as
A) the explicit costs of production. B) net income. C) net worth. D) a normal rate of return.
Assume that any given percentage of the population earns an equal percentage of real GDP. This percentage of population will be represented by:
a. a point below the line of income equality. b. a line lying below the line of income equality. c. a point on the line of income equality. d. a line lying above the line of income equality. e. a point above the line of income equality.