Markets do not ensure that the air we breathe is clean because
a. clean air has no value.
b. the government prevents markets from doing so.
c. property rights are not well established for clean air.
d. clean air is impossible to produce .
c
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If a perfectly competitive firm's average total cost is less than the price, then the firm
A) incurs an economic loss. B) makes an economic profit. C) makes zero economic profit. D) makes either zero economic profit or an economic profit depending on whether the marginal revenue is equal to or greater than the price. E) None of the above answers is correct because the relationship between the price and average total cost has nothing to do with the firm's profit.
If a country lends more to foreign countries than it borrows from foreign countries in a year, then definitely during that year
A) it has a current account deficit. B) it is a creditor nation. C) it is a debtor nation. D) it is a net lender.
If a good is inferior, then the income elasticity of demand for that good is
a. positive and greater than 1 b. negative c. positive and less than 1 d. 0 e. perfectly elastic
If the initial deposit into the banking system is $500 billion, and if the total $8,000 billion represents the maximum money supply permissible, then the legal reserve requirement must be
a. 8 percent b. 6.25 percent c. 11 percent d. 12 percent e. 12.3 percent