The ______________ level of production occurs when the externality is fully internalized and can be _____________ over time as we develop better pollution control technologies.
a. minimum; increased
b. minimum; reduced
c. optimal; increased
d. optimal; reduced
e. market; reduced
Ans: d. optimal; reduced
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Historically, empirical evidence showed that it was more cost effective to have a single generator of electricity serve a particular region's electricity needs than to have several smaller units compete against each other
More recently, technological advances have occurred in the generation of electricity that allow much smaller generating units to produce electricity for the same average cost as much larger units. Explain how this change would be reflected in the firm's long-run average cost curve and minimum efficient scale.
________: the monetary amount by which a nation's merchandise imports exceed imports during a given time period, usually one year
Fill in the blank(s) with correct word
A good that has external benefits associated with its production will be
A. overproduced. B. underproduced. C. not produced. D. produced at the optimal level.
In the Solow model, if f(k) = 2k0.5, s = 0.25, n = 0.05, and d = 0.2, what is the value of k at equilibrium?
A. 1 B. 2 C. 3 D. 4