If public goods were marketed like private goods, then
A. Public goods would be efficiently produced.
B. Society would be closer to achieving the optimal mix of output.
C. People would avoid paying for these goods.
D. Market failure would not occur.
Answer: C
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If the Federal Reserve attempts to continue reducing unemployment by manipulating monetary policy, which of the following would you expect to see?
A) The rate of inflation will fall as the Fed tries to reduce the unemployment rate. B) The Fed's policies will be deflationary. C) The Fed's policies will be inflationary. D) The Fed will reduce the natural rate of unemployment.
If future changes in stock prices are unpredictable, then we say that the stock prices follow a
A) random walk. B) straight and narrow path. C) meandering path. D) generalized walk.
Once the expenditure schedule has been adjusted for tax levels, the determination of equilibrium GDP
a. is no longer possible. b. becomes much more difficult. c. proceeds exactly as before. d. requires a higher multiplier value.
Identify the correct mathematical relationship between the marginal propensity to consume (MPC) and the marginal propensity to save (MPS)
a. MPC + MPS = 1 b. MPC – MPS = 1 c. MPC × MPS = 1 d. MPS + MPC = 0