The development of market power by a firm is considered to be a market failure because firms with market power will
A. Produce more and charge a lower price than what would be socially optimal.
B. Not respond to consumer demand.
C. Tend to ignore external costs.
D. Produce less and charge a higher price than what would be socially optimal.
Answer: D
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In 2015, GDP per person in the United States was almost
a. $38,000. b. $36,000. c. $49,000 d. $56,000
Economist George Borjas has estimated the net benefits (+)/costs (-) to the United States from labor immigration to be approximately:
a. +10% of GDP. b. -5% of GDP. c. +0.1% of GDP. d. 0.5% capital loses and 0.8% labor gains.
Rent-seeking behavior refers to
A. a transfer of knowledge between private and public sectors. B. companies that try to increase profit by cutting costs or improving products. C. companies that spend money on influencing government rather than on profit-increasing strategies. D. consumer real estate studies that focus on renting versus buying.
Recall the Application about the value of trees in residential neighborhoods to answer the following question(s).Recall the Application. The benefits from planting trees in residential neighborhoods, including improved air quality and aesthetics, go to the property owner as well as the neighbors. This implies that trees provide:
A. only private benefits. B. only social benefits. C. both private and social benefits. D. only public benefits, but not private or social benefits.