If an external benefit is present, then the
A) marginal private benefit curve lies above the marginal private cost curve.
B) marginal social benefit curve lies above the marginal private benefit curve.
C) marginal social cost curve lies above the marginal private benefit curve.
D) marginal social benefit is equal to the marginal social cost.
E) marginal social benefit curve is the same as the marginal private benefit curve.
B
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Use the following table, which shows the aggregate demand and aggregate supply schedule for a hypothetical economy, to answer the next question.Real Domestic Output Demanded (in billions)Price Level (index value)Real Domestic Output Supplied (in billions)$500350$3,5001,0003003,0001,5002502,5002,0002002,0002,5001501,5003,0001001,000If the quantity of real domestic output demanded increased by $1,000 at each price level, the new equilibrium price level and quantity of real domestic output would be ________.
A. 150 and $2,500 B. 300 and $3,000 C. 250 and $2,500 D. 200 and $2,000
Vaccination against a disease helps in preventing the spread of the disease. Which of the following can help in increasing the number of people vaccinated to the socially optimal level?
A) A corrective tax B) An income tax C) A life insurance D) A health tax
Inoculation programs against certain diseases such as small pox, polio, and whooping cough create
a. public goods. b. positive externalities in consumption. c. nonrival goods. d. nonexcludable goods. e. external costs to society equal to the costs of the program.
Mika's Manicures leases a space in the local mall for $4,500 a month. For this business, this expense would be considered an:
A. explicit cost of $0. B. explicit cost of $4,500. C. implicit cost of $4,500. D. This is neither an implicit or explicit cost; it is a fixed cost of $4,500.