When the social costs of producing or consuming a good exceed the private costs, _____
a. a positive externality exists
b. an inefficiently high quantity of the good will be produced and consumed, from the society's point of view
c. the direct consumers of the good will bear the external costs
d. the individuals involved in the production of the good do not bear the private costs
e. the quantity of the good produced will be less than the socially efficient level
b
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When production reflects consumer preferences, ________ occurs
A) productive efficiency B) allocative efficiency C) equity D) efficient central planning
The creation of the European Monetary Union in 1999 lowered nominal interest rates in countries like Italy, because:
a. Nations in the European Monetary Union were required to reduce the maturity of their debt issues. b. Each nation now had a solid currency, and the markets knew that the central banks of these nations could create as much money as necessary to repay government debts. c. Markets had more confidence in the European Central Bank than they did in the Bank of Italy. d. All of the above. e. None of the above.
To increase output, policymakers can _____ the money supply, _____ taxes, and/or _____ government purchases
Fill in the blank(s) with correct word
Suppose a firm wanted to go out of business. The firm sells all its assets and pays off everything it owes to creditors. The stockholders would receive
A. one half of the funds; the other half of the funds goes to bondholders. B. the rest of the funds, after everyone who has a claim against the firm is paid. C. nothing. D. their annual dividend payment.