This graph shows the marginal cost and marginal benefit associated with roadside litter clean up. Assume that the marginal benefit curve and marginal cost curve each have their usual slope.
The marginal cost of litter removal ________ due to ________.
A. decreases; diminishing returns to inputs
B. increases; increasing opportunity costs
C. increases; the Coase Theorem
D. decreases; gains from specialization
Answer: B
You might also like to view...
John Maynard Keynes argued that if many households decide at the same time to increase saving and reduce spending
A) the economy will benefit in the short run and benefit by an even greater amount in the long run. B) this will have a major negative impact on the economy in both the short run and in the long run. C) this may benefit the economy in the long run, but could be counterproductive in the short run. D) this may benefit the economy in the short run, but not in the long run.
If Year 1 is the base year, the GDP price deflator for Year 2 is approximately
A) 100.0. B) 126.3. C) 131.3. D) 181.0.
In developing countries, it is not true that
a. banks are often viewed with suspicion b. at the first sign of economic problems, many bank depositors withdraw their funds c. because banks cannot rely on a continuous supply of deposits, banks cannot make loans for extended periods d. if financial institutions fail to serve as intermediaries between savers and borrowers, the lack of funds for investment will make growth rates double e. the credit provided by banks as a percent of total output is one fifth that in high-income countries
If the costs of negotiating and enforcing contracts are _____ relative to the benefits, buyers and sellers have incentives to make economically efficient arrangements that _____ value
a. high; increase b. low; increase c. high, decrease d. low; decrease