A compulsory payment to government that is generally linked to engaging in some activity is referred to as a
A) tax.
B) subsidy.
C) deadweight loss.
D) quota.
A
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Consider the production of some industrial good that involves air pollution. The table below gives the marginal social cost (MSC), the marginal cost (MC), and the marginal social benefit (MSB) for each level of output (Q)
Q MSC MC MSB 1 3 2 11 2 6 4 10 3 9 6 9 4 12 8 8 5 15 10 7 6 18 12 6 To arrive at the efficient market equilibrium the government could impose a tax of A) $3. B) $4. C) $8. D) $9.
Which of the following is not a characteristic of a public good?
a. It is not excludable. b. It is not diminished or depreciated as additional people consume the good. c. Its benefits cannot be withheld from anyone. d. Because it is a free good, there is no opportunity cost.
Sally lost her job when her company went out of business because of a recession. This is an example of:
A. frictional unemployment. B. structural unemployment. C. cyclical unemployment. D. technological unemployment.
Which of the following describes how a positive externality affects a competitive market?
A) The externality causes a difference between the private benefit from consumption and the social benefit. B) The externality causes a difference between the private benefit from production and the social cost of production. C) The externality causes quantity demanded to exceed quantity supplied. D) The externality causes a difference between the social cost of production and the social cost of consumption.