If there are external costs in production and firms do not have to account for these costs, then firms will produce
A. at the efficient level.
B. an output level that is below the efficient level.
C. an output level that is either above or below the efficient level.
D. an output level that is above the efficient level.
Answer: D
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You are likely to think that the relative price of your good has risen and you should increase your output if you expected
A) the inflation rate to be 10% and the price of your good rose 7%. B) the inflation rate to be 10% and the price of your good rose 10%. C) the inflation rate to be 10% and the price of your good rose 13%. D) the inflation rate to be 0% and the price of your good fell 10%.
A monopolistically competitive firm differs from a perfectly competitive firm in that a monopolistically competitive firm: a. faces a downward-sloping demand curve for its product
b. faces a horizontal demand curve at the market-clearing price. c. is able to earn profits in the long run. d. faces virtually no barriers to entry.
On a graph that depicts the market for loanable funds, the nominal interest rate is measured along the vertical axis
a. True b. False Indicate whether the statement is true or false
John is planning ahead for retirement in a two-period world. When John is young he will earn $1 million, and when John is old and retired he will be given $50,000 from Social Security. If the interest rate between the two time periods is 7 percent, what is the slope of John's budget constraint when considering the consumption possibilities between the two periods if consumption when young is
graphed on the horizontal axis and consumption when old is graphed on the vertical axis? a. -0.89 b. -1.05 c. -1.07 d. -1.12