What will arise when negative externalities are present in a market?
a) Government will regulate the externalities in the market.
b) Private costs will be greater than social costs.
c) The market will not be able to reach any equilibrium situation.
d) Social costs will be greater than private costs.
Ans: d) Social costs will be greater than private costs.
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Big Al’s Burger Emporium lowered the price of its burgers from $8 to $6. The firm saw sales of burger increase from 1,200 per week to 2,000 per week. This implies that the price elasticity (dropping any negative signs) is
A. 0.29 B. 0.57 C. 1.75 D. 0.50
The flow of private foreign investment and grants and loans is included in a country's
(a) current account. (b) capital account. (c) cash account. (d) none of the above.
The adverse supply shocks experienced during the 1970s strengthened the Philips Curve relationship between inflation and unemployment
Indicate whether the statement is true or false
A perfectly discriminating monopsonist
A. pays the equilibrium wage to all workers. B. faces an increasing value of the marginal product curve. C. receives zero profit in the long run. D. pays each worker his or her reservation wage. E. disregards minimum wage laws.