Private decisions about consumption of common resources and production of public goods usually lead to an
a. efficient allocation of resources and external effects.
b. efficient allocation of resources and no external effects.
c. inefficient allocation of resources and external effects.
d. inefficient allocation of resources and no external effects.
c
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The relationship between a firm's advertising expenditure and its profit is studied under:
A) international economics. B) microeconomics. C) public economics. D) macroeconomics.
According to Ricardian equivalence, a long-run impact on the economy occurs when the government ________
A) lowers taxes B) issues more government bonds C) increases spending on capital goods D) raises taxes
Aggregate demand equals: a. C + G + I + EX
b. C + G + I + EX + IM. c. C + G + I – EX + IM. d. C + G + I + EX – IM.
If the income-consumption path slopes down, then:
A. both goods are inferior. B. both goods are normal. C. one good is normal and the other good is inferior. D. we can't tell anything about whether the goods are normal or inferior.