In the case of public goods, _____
a. the free rider problem does not arise
b. one person's consumption of the good reduces the consumption of the good by others
c. individuals can be easily excluded from consuming the good once it is provided
d. the quantity produced by a private market would be too large from society's viewpoint
e. the principle of mutual excludability and principle of rivalry do not apply
e
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The relationship between consumer spending and income is known as the
A) rate of individual wealth. B) consumption function. C) rate of income. D) inflation rate.
When the government decides to impose a tax on sellers of a good or service, sellers try to pass the tax on to consumers by raising the price of the good being sold
Assume the government decides to place a $1 tax on each unit of a good sold, e.g., tires. Using the simple model of supply and demand, illustrate what would happen to the price and quantity of tires sold. Would the amount of tax paid by the consumer (as opposed to the producer) be greater when demand is elastic or inelastic? Why?
Properties of long-run competitive equilibrium with free entry include:
A. an equilibrium price equal to the minimum MC. B. firms earning positive profits. C. active firms producing at their efficient scales of production. D. All of these are properties of long-run competitive equilibrium.
A public good is
a. any good provided by government. b. a good that can be most cheaply provided by government, though it may in fact be provided by private enterprise. c. a good whose benefits cannot readily be restricted to a small group of people. d. a good whose benefits cannot be enjoyed by an individual alone.