The "tragedy of the commons" refers to the phenomenon where
A) there is rivalry in consumption. B) people overuse a common resource.
C) people do not internalize an externality. D) individuals are free riders.
B
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Which of the following statements is true?
A) Non-bank institutions are also a part of the credit market. B) People who lend money are known as debtors. C) People who borrow money are known as creditors. D) Money that is lent out is considered to be a liability.
If enforcement is aimed at sellers of an illegal good, its equilibrium price will ________ and its equilibrium quantity will ________
A) rise; increase B) rise; decrease C) fall; increase D) fall; decrease
A trade-off of using monetary policy to maintain a pegged exchange rate
a. increases the power of the central bank. b. always increases the interest rate. c. cannot be used to address inflation or unemployment. d. cannot be used to change tax policies.
The president of the United States promises that the nation's economy will simultaneously produce more defense goods without any decreases in the production of other goods. Under which of the following conditions could such a promise be valid?
A. if the United States were producing inside its production possibilities curve B. if the United States were producing at a point on its production possibilities curve C. if the United States were producing to the right of its production possibilities curve D. None of these; the production possibilities curve must shift to the right.