When a positive externality is present in a market, total surplus is:
A. higher when buyers only consider private costs.
B. lower when buyers only consider private costs.
C. lower when buyers consider social costs.
D. None of these statements is true.
B. lower when buyers only consider private costs.
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If the marginal propensity to consume is 0.75, then the value of the tax multiplier is
A) -2.5. B) -3. C) 1.25. D) 1.4.
The minimum point of a U-shaped curve,
A) is a point where the variable is neither increasing nor decreasing. B) has a slope equal to zero. C) has the maximum slope possible. D) Both answers A and B are correct. E) Both answers A and C are correct.
In the macroeconomic short run
A) actual real GDP may be less than or more than potential GDP. B) the unemployment rate is zero. C) by definition, the economy is always moving away from full employment. D) actual real GDP always equals potential GDP.
Transaction costs
What will be an ideal response?