The Coase theorem proves that externalities will be neutralized by bargaining
Indicate whether the statement is true or false
F The Coase theorem shows that incentives exist for bargaining to an improved, more efficient equilibrium, but transaction costs may readily prevent the achievement of that outcome.
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A recent study found that it was cheaper to buy a chicken dinner from Kentucky Fried Chicken than it was to prepare it at home. The researcher included all costs including the imputed value of time involved to prepare the meal at home. This study illustrates the
A. value of marginal analysis. B. law of increasing costs. C. difference between real costs and money costs. D. cost disease of the service sector.
In a closed economy, which of the following components of GDP is not included?
A) net exports B) consumption C) investment D) government spending
Which of the following is an example of an efficiency wage?
a. a high wage paid to compensate for dangerous work such as coal mining b. an above-equilibrium wage offered by a firm to attract a more talented pool of job applicants c. a wage below the minimum wage but supplemented by customer tips d. a high wage paid to a college graduate for a high-skill job such as electrical engineering
All of the following are reasons a government might choose to protect monopoly rights in an industry except:
A. because it is in the public's interest to do so. B. to encourage innovation. C. to increase consumer surplus beyond what is achieved through competition. D. to benefit insiders.