Assume that the production of a good imposes external costs upon third parties. If the price and quantity of this good is set by supply and demand the price will be too:
a. high and quantity too low for efficient resource allocation.
b. low and quantity too low for efficient resource allocation.
c. low and quantity too high for efficient resource allocation.
d. high and quantity too high for efficient resource allocation.
c
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In the short-run
A) the aggregate supply curve is upward sloping. B) real GDP is always equal to potential GDP. C) the money wage rate can change. D) the price level does not change.
Keynes believed that the instability in income was caused by variability in
a. investment. b. taxes. c. consumption and savings. d. government spending.
The study of inflation is part of:
a. Macroeconomics b. Microeconomics c. Urban economics d. Home economics
What is the domestic price of a TV in a closed economy?
A. $100 B. $137.50 C. $125 D. $75