The potential profit from new technological advancements and innovations
A. gives the public sector a better incentive to make investments into farsighted research.
B. provides similar incentives to the private and public sectors with respect to researching new technologies.
C. leads to rent-seeking behavior and corruption in government.
D. gives the private sector a better incentive to commercialize new technologies.
Answer: D
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Total consumer surplus in a market is measured as the
A) area bounded above the market clearing price and beneath the market demand curve. B) area bounded below the market clearing price and above the market supply curve. C) vertical distance from the horizontal (quantity) axis to the market clearing price. D) horizontal distance from the vertical (price) axis to the equilibrium quantity.
A union may negotiate limits on workload in order to increase the demand for labor and raise workers' salaries. This practice is known as:
a. featherbedding. b. human capital formation. c. monopsonistic bargaining. d. artificial demand stimulus.
Which of the following is an example of an externality?
a. Drug abuse affecting David's health. b. Sara taking a break from work. c. A transaction between two parties, affecting them alone. d. Tom's smoking affecting his roommate's health.
Which of the following weakened the demand stimulus effects of the fed's low interest rate policy during the years following the 2008-2009 recession?
a. Rising stock prices in response to the low-interest rate policy. b. The lower cost of borrowing to undertake business investment. c. An increase in the velocity of money. d. A reduction in earnings of senior citizens and others from money market accounts, saving deposits, and similar forms of savings.