If only a few people are affected by an externality, then it is likely that
a. the government will play a role in collective action.
b. command-and-control regulation will provide the most efficient solution to the externality.
c. a private solution to the inefficiency will occur.
d. a private solution will be very difficult to negotiate.
c
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Why is it necessary for a firm that practices price discrimination be a price maker rather than a price taker?
What will be an ideal response?
The experience with development policy over the last several decades now allow us to
a. predict the result of any country's policies b. establish the right mix of government and private sector c. be more confident about what issues are important and what directions to take d. show how one country's success can be repeated by another country e. we have not learned any good general lessons from experience
During recessions, GDP falls and unemployment increases. Why might the actual output produced not fall as much as officially measured GDP during recessions?
a. There is an increase in involuntary part-time employment during recessions, the output from which is not accounted for in GDP b. Workers who became unemployed during the recession may produce goods in the underground economy c. Unemployment benefits to laid off workers are included in GDP d. Laid off workers may start their own businesses, but profit income from self-employment is not accounted for in GDP e. Unemployed workers have more leisure time to enjoy.
To increase U.S. energy independence, prices must be lowered on gasoline and electricity.
Answer the following statement true (T) or false (F)