In the above figure, market equilibrium at point E yields the quantity X. The quantity is the socially optimal quantity. Point E indicates that currently there is
A) a negative externality.
B) a positive externality.
C) a public good.
D) a positive externality with subsidy.
A
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A situation in which there is a reduction in quantity supplied to zero when there is the slightest decrease in price is
A) perfectly elastic supply. B) perfectly elastic demand. C) perfectly inelastic supply. D) perfectly inelastic demand.
A merger between two firms that have a supplier-purchaser relationship is:
a. horizontal. b. vertical. c. conglomerate. d. illegal. e. inefficient.
In traditional Keynesian economics:
a. the aggregate supply curve is vertical. b. the aggregate supply curve is horizontal. c. the aggregate supply curve is upward-sloping. d. the aggregate demand curve is horizontal. e. the aggregate demand curve is vertical.
Commodity egalitarianism refers to commodities that
A. are important for most consumers. B. are too dangerous for most consumers. C. should be made available to all consumers. D. are good ideas but never produced.