We typically call an external cost:
A. a network externality.
B. a negative cost.
C. a negative externality.
D. a societal drain.
Answer: C
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The record of international receipts and payments is called the
A) official settlements account. B) balance of payments. C) U.S. official reserves. D) current account. E) capital and financial account.
For simple loans, the simple interest rate is ________ the yield to maturity
A) greater than B) less than C) equal to D) not comparable to
According to Coase, the optimal allocation of resources is guided by
a. the decisions of a firm's managers b. market prices when market transaction costs are greater than the firm's internal organization costs c. the decisions of a firm's managers when market transaction costs are greater than the firm's internal organization costs d. the decisions of a firm's managers when market transaction costs are less than the firm's internal organization costs e. entrepreneurs
If the economy is in a recession, and the government raises taxes in an effort to balance the budget, the Keynesian model indicates the likely effect will be to
a. counteract the recession. b. prolong the recession and increase its severity. c. end the recession sooner. d. increase the level of real GDP.