Which of the following situation would make transaction costs too high to negotiate and therefore the Coase Theorem would not apply?
A. Only a few people are bothered by the pollution in the area
B. Many people are bothered by pollution in the area
C. Many firms are in the area with different levels of pollution
D. One firm is the cause of the pollution
Answer: C
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If prices are rising on average, then
A) real GDP will be less than nominal GDP in the years before the base year. B) real GDP will be greater than nominal GDP in the years after the base year. C) real GDP will always be equal to nominal GDP. D) real GDP will be greater than nominal GDP in the years before the base year.
Mail-in ballots are designed to:
A. decrease the costs associated with voting. B. increase utility derived from voting. C. increase your ability to fulfill your civic duty. D. increase the accuracy voting process.
Are bank lines of credit to small firms collateralized?
A) All of them are. B) Some of them are, especially if the firm is risky. C) Some of them are, especially if the firm is safe. D) None of them are.
Managers at Concord Construction have determined that the firm’s revenues do not cover the firm’s average variable costs. Which term describes the situation at Concord Construction?
a. The shutdown point b. Allocative inefficiency c. Diseconomies of scale d. The price taking point