If the marginal private cost of producing one kilowatt of power in California is ten cents and the marginal social cost of each kilowatt is fourteen cents, then the marginal external cost equals ________ per kilowatt
A) ten cents
B) nineteen cents
C) four cents
D) zero cents
E) fourteen cents
C
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In the Stackelberg model, there is an advantage
A) to waiting until your competitor has committed herself to a particular output level before deciding on your output level. B) to being the first competitor to commit to an output level. C) to the firm with a dominant strategy. D) to producing an output level which is identical to a monopolist's output level.
Imagine that there are only two nations in the world, the United States and Mexico. If Americans buy more goods made in Mexico, other things constant, the
a. U.S. demand curve for Mexican pesos will shift rightward b. U.S. demand curve for Mexican pesos will shift leftward c. U.S. supply curve of Mexican pesos will shift leftward d. U.S. supply curve of Mexican pesos will shift rightward e. U.S. supply curve of Mexican pesos will shift upward
Is it correct to say that if the total balance of payments does not equal zero, then the reserves account will automatically adjust to ensure it equals zero
a. Yes. b. No. c. The answer is "maybe" because it always depends on the circumstances.
Which of the following is true about a differentiated-product Bertrand duopoly?
A. Firm 1 and firm 2's reaction functions are downward sloping. B. Firm 1 and firm 2's reaction functions are upward sloping. C. In a differentiated-product Bertrand duopoly neither firm has a reaction function. D. Firm 1's reaction function is downward sloping but firm 2's reaction function is upward sloping.