When U.S. farmers in the Southwest irrigate their land, salt in the ground soil leaks into the Colorado River. The Colorado River has become so salty that Mexican farmers further down the river cannot irrigate their own land and Mexican crops have been devastated. This situation constitutes a negative externality because:
Ans: U.S. farmers consider only their private costs in their decision making.
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In the above figure, what is autonomous consumption?
A) $3.0 trillion B) $1.0 trillion C) $0.0 trillion D) $2.0 trillion
An economy is better off with an increase in the stock of capital
Indicate whether the statement is true or false
Advertising costs
A) make the marginal revenue more elastic. B) shift the ATC curve upward. C) shift the marginal cost curve rightward. D) indirectly shift the marginal cost curve upward. E) affect the marginal cost but not the total cost.
Which of the following variables that affect the money stock are outside the direct control of the Federal Reserve?
a. Currency/deposit ratio b. Excess reserve/deposit ratio c. Required reserve/deposit ratio d. The speed of the money creation process. e. Both a and b