If the government assigns private property rights to a common resource, then the
A) resource is under-utilized.
B) marginal private cost becomes equal to the marginal social cost.
C) government needs to set a quota to achieve efficiency.
D) None of the above answers is correct.
B
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The larger is the reserve ratio, the:
A. smaller is the money multiplier, and the less money will be created in the economy. B. smaller is the money multiplier, and the more money will be created in the economy. C. larger is the money multiplier, and the less money will be created in the economy. D. larger is the money multiplier, and the more money will be created in the economy.
If the MPC is 0.80, then a change in disposable income of $60 billion will lead to an initial change in consumption of
A. $30 billion. B. $42 billion. C. $48 billion. D. $60 billion. E. $70 billion.
Suppose buyers in the used car market are willing to pay $8,000 for a plum (high-quality) used car and $3,000 for a lemon (low-quality) used car. If buyers believe that 20% of the used cars on the market are lemons (low quality), what would they be willing to pay for a used car?
A. $7,000 B. $6,000 C. $5,000 D. $4,000
The demand for refrigerators falls when the economy enters a downturn. If a refrigerator manufacturer lays off workers during an economic downturn, this would be an example of
A. cyclical unemployment. B. natural unemployment. C. frictional unemployment. D. structural unemployment.