When external costs are present in a market,
a. less of the good will be produced than the amount consistent with economic efficiency.
b. more of the good will be produced than the amount consistent with economic efficiency.
c. the amount of the good produced will be equal to the amount consistent with economic efficiency.
d. corresponding external benefits are always generated.
B
You might also like to view...
Social Security began as a "pay-as-you-go" system, meaning that payments to current retirees were paid
A) from taxes collected from current workers. B) as the government collected revenues from tariffs and excise taxes in the years Social Security payments were made. C) as long as the government had funds available. D) from taxes collected from retired workers.
In the case of negative externalities in production, the firm's internal costs:
a. exceed the external costs. b. are less than the external costs. c. equal the external costs. d. understate the true cost of producing the product. e. overstate the true cost of producing the product.
Which statement is true?
A. No one receiving public assistance is employed. B. Some people receiving public assistance are employed. C. More people were receiving public assistance in 2007 than in 1994. D. According to current law, no one will be eligible to receive public assistance by the end of 2012.
According to the more-is-better principle:
A. a consumer will always select the bundle that is ranked highest among all alternative bundles. B. a consumer will prefer a bundle that has the largest amount of the good they prefer most. C. consumers always try to achieve the highest possible level of well-being. D. when comparing consumption bundles, a consumer prefers a bundle that has more of every good.