Your neighbor has just planted some fragrant flowers. The wonderful scent drifts into your room and makes you happy
A) This scent is an internal cost to you.
B) This cannot be an externality since you are enjoying the scent.
C) This is an externality since you get a benefit from your neighbor's flowers.
D) The social cost of this activity is entirely borne by you neighbor.
Answer: C
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How does the idea of a leaky bucket relate to the study of income distribution?
Suppose a certain good provides an external benefit. If the private cost of the last unit of the good that was produced is equal to the social value of that unit, then the sum of producer and consumer surplus is maximized
a. True b. False Indicate whether the statement is true or false
If E$/£ moves from 2 to 3, this is a percentage change of:
a. 50%. b. 33.3%. c. -33.3%. d. -50%.
Unanticipated positive inflation
A. benefits banks. B. hurts debtors. C. hurts everyone. D. hurts creditors.