Which of the following pairs of goods includes a good that is excludable and rival in consumption as well as a good that is excludable and not rival in consumption?
a. pizza, cable TV
b. pair of pants, clean air
c. clean air, mathematical theorem
d. basic research, fireworks display
a
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Review three methods that might achieve the efficient use of a common resource and explain the obstacles to efficiency
What will be an ideal response?
If a cartel firm is producing a quantity at which the marginal revenue is $4 and the marginal cost is $4, the firm ________.
A) is producing less than the agreed upon quantity B) is producing the agreed upon quantity C) has erected a barrier to entry D) has acted in self-interest
If the poor cannot afford proper medical treatment, an economist, for reasons of efficiency, would favor
a. giving the poor added income to spend as they see fit. b. paying doctors bonuses to treat the poor. c. paying the medical bills of the poor. d. giving the poor "medical stamps."
Crowding out occurs when
A. increased taxes force higher levels of national saving. B. deficit spending by the government forces private investment spending to contract. C. local businesses cannot get government contracts because of the higher bids of large corporations. D. foreign investors are willing to pay higher prices for U.S. bonds than American citizens will pay.