Many nations are consistently accused of enjoying the benefits of membership in the United Nations, yet they provide few or no funds to support the organization. This is an example of
A. the negative externality problem.
B. the free-rider problem.
C. the principle of rival consumption.
D. the property rights problem.
Answer: B
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Which of the following is likely to be most capital-intensive?
A. Production of clothing in rural China. B. Farming in developing countries. C. Oil refining in the United States. D. None of the choices are correct.
The theory of monopolistic competition predicts that in long-run equilibrium a monopolistically competitive firm will:
A. produce the output level at which price equals long-run marginal cost. B. operate at minimum long-run average cost. C. overutilize its insufficient capacity. D. produce the output level at which price equals long-run average cost.
The process of an economy adjusting from a recession back to potential GDP in the long run without any government intervention is known as
A) fiscal policy. B) monetary policy. C) an automatic mechanism. D) "releasing sticky prices."
It is believed that the relatively high rate of labor force growth in the developing countries does not translate into a high rate of economic growth because:
a. workers in developing countries have excess capital. b. workers in developing countries are not motivated enough. c. workers in developing countries do not have the natural resources needed for production. d. workers in developing countries have very little capital. e. the high birth rate is more than offset by an enormous mortality rate.