The above figure shows the marginal private benefit and marginal social cost of a college education. If society's external benefits from college graduates is $10,000 each, then the
A) marginal social cost curve lies $10,000 to the left of the private marginal benefit curve.
B) marginal social cost curve lies $10,000 to the right of the private marginal benefit curve.
C) marginal social benefit curve lies $10,000 below the private marginal benefit curve.
D) marginal social benefit curve lies $10,000 above the private marginal benefit curve.
D
You might also like to view...
Which of the following is not included in gross domestic private investment, as defined in national income accounts?
A. The value of all new capital goods bought by business firms B. Changes to business inventories C. Domestic home construction undertaken by and for the private sector D. Government construction of new highways and dams
The figure above shows the demand for fruit snacks. Which movement reflects how consumers would react to an increase in the price of a non-fruit snack?
A) from point a to point e B) from point a to point b C) from point a to point c D) from point a to point d
Gross private domestic investment includes business:
a. purchases of capital goods, all new construction, and purchases of consumer durable goods. b. purchases of capital goods, all new construction, and inventory investment. c. purchases of capital goods, all new commercial construction, and inventory investment. d. purchases of capital goods, all new residential construction, and inventory investment. e. purchases of all types of durable goods, all new construction, and inventory investment.
"Because apples and oranges are substitutes, an increase in the price of oranges will cause the demand for apples to increase. This initial shift in demand for apples results in a higher price for apples; this higher price will cause the demand curve for
apples to shift to the right." Which of the following correctly comments on this statement? A) The statement will be true if consumer tastes for apples and oranges do not change. B) The statement is false because a change in the price of apples would not change the demand for apples. C) The statement is false because oranges are inferior goods; apples are normal goods. D) The statement is false because one cannot assume that apples and oranges are substitutes for all consumers.