Whenever external costs exist:
A.) Social demand is less than market demand.
B.) Market demand is less than social demand.
C.) Market demand and social demand are equal.
D.) Market demand understates the social benefits.
A.) Social demand is less than market demand.
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A firm sells 30 units of its product at a price of $5 per unit. It incurs a fixed cost of $100 and a variable cost of $20. The firm's profit is:
A) $30. B) $50. C) $100. D) $150.
Which of the following is accurate about John Maynard Keynes?
a. He was one of the most influential economists in early U.S. history. b. He believed economics is a subject but not a way of thinking. c. He believed economics is not just a subject area but also a way of thinking. d. He believed that economics is not a subject but is a way of thinking.
Assume both the demand for beef and the supply of beef decrease. Which of the following outcomes is certain to occur?
A. The equilibrium quantity of beef will rise. B. The equilibrium quantity of beef will fall. C. The equilibrium price of beef will fall. D. The equilibrium price of beef will rise.
Measuring the rate of inflation using a market basket that excludes food and energy prices is preferred by some analysts because this measure, called core inflation,:
A. provides a real, rather than a nominal, rate of inflation. B. gives a better measure of ongoing, sustained price changes. C. is more consistent with measures of inflation used in other countries. D. fluctuates more than measures of inflation that include food and energy prices.