Free riding often results than less than the optimal quantity of a good being produced
Indicate whether the statement is true or false
TRUE
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The phenomenon whereby labor decreases in response to a decrease in the wage rate is called
a. the substitution effect. b. the scale effect. c. derived demand from a change in wage. d. the factor regressivity of labor.
The natural rate of employment
a. will change with changes in the long run aggregate supply curve. b. will be a level such that the expected real wage equals the actual real wage. c. will be at a level where the actual and expected price levels are equal. d. both a and c. e. all of the above.
Because resources are scarce, if society produces more of one commodity, it has to sacrifice some amount of another commodity. The amount sacrificed is
a. a normative problem b. the out-of-pocket cost c. the opportunity cost d. the lost profit e. the total factor productivity
If both borrowers and lenders anticipate the rate of inflation correctly, then
a. borrowers will lose real income. b. lenders will lose real income. c. both borrowers and lenders will lose real income. d. neither borrowers nor lenders will lose real income.