A person removes the anti-pollution devices on his automobile. An external cost associated with this is
A) the feeling of guilt the person feels for violating the law.
B) the ticket he gets when a highway patrol officer pulls him over.
C) the man's neighbor washes his car more often because of increasing smog.
D) the man buys less gasoline, reducing the income of local gas stations.
C
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A decrease in the discount rate ________ bank reserves and ________ the federal funds rate
A) increases; raises B) increases; lowers C) decreases; raises D) decrease; lowers
A natural monopoly has a. constant average costs cost over the relevant range of output. b. economies of scale over the relevant range of output
c. constant returns to scale over the relevant range of output. d. diseconomies of scale over the relevant range of output.
A local cable company has its rates set at P = $15 by a regulatory commission. Its current output is 10,000 households and its costs are as follows: ATC = $17; AVC = $14; and MC = $15 . From this, we can tell that this is
a. a fair price, and the firm earns a normal profit b. a fair price, and the firm earns an economic loss c. marginal cost pricing, and the firm earns a normal profit d. marginal cost pricing, and the firm earns an economic loss e. the same price that an unregulated monopolist would charge
Which one of the factors of production originates as an output from the production process, and is subsequently used as an input into the production process?