How does a government-sponsored good differ from a public good?
What will be an ideal response?
A public good is characterized by the fact that consumption is not rival and by the presence of the free-rider problem. Government-sponsored goods are private goods that the political process has deemed desirable.
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One condition for the first welfare theorem to hold is that there are no externalities. Can this condition be re-phrased as "all property rights have been established"? And how does this justify a wide range of what we see government doing?
What will be an ideal response?
If a potato farmer increases output and finds that total revenue increased less than total cost, then you know for sure that
a. profit had been maximized b. the farmer should not have increased output c. the farmer should produce even more output d. the farmer suffers a loss e. the farmer should have decreased output, not increased it
The United States generally has a comparative advantage in the development of technology because it has:
A. patent laws, which no other country has. B. large amounts of natural resources. C. a disproportionate share of the world's best research universities. D. the greatest need for new technology.
The speculative, transactions, and precautionary demands for money added together give the
A. Keynesian liquidity trap. B. Monetarist demand-for-money curve. C. Market demand curve for money. D. Market supply curve for money.