Which of the following is an example of an externality?
a. cigarette smoke that permeates an entire restaurant
b. a flu shot that prevents a student from transmitting the virus to her roommate
c. a beautiful flower garden outside of the local post office
d. All of the above are correct.
d
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Sam is suing someone in court for $10,000. The probability that Sam will lose the case is 1/h where h is the number of hours that Sam's attorney works on the case
The lawyer charges $500 per hour if he is to be paid hourly, or he requests 20% of the settlement if he is to be paid on a contingency basis. Assuming both Sam and the attorney are risk-neutral wealth maximizers, is either contract efficient?
Entrepreneurs, if successful, earn
a. rent b. profit c. wages d. salary e. interest
Loopholes increase the efficiency of the tax system by making taxpayers better off
a. True b. False Indicate whether the statement is true or false
The current account balance consists of
A. net exports of goods and services, minus net unilateral transfers. B. net exports of goods and services, plus net income from abroad, plus net unilateral transfers, minus the financial account balance. C. net exports of goods and services, plus net income from abroad, plus net unilateral transfers. D. the trade balance plus the services balance.