To determine the incidence of a tax, it is necessary to have information on both the elasticity of demand and the elasticity of supply
a. True
b. False
Indicate whether the statement is true or false
True
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What the economist calls externalities create social problems
A) because opportunity costs are low when people live close to one another. B) only when the externalities are negative spillovers. C) partly because people have a limited ability to empathize. D) when people know about all the consequences of their behavior.
Which is NOT an example of moral hazard
a. people eat more at all-you-can-eat buffets b. loggers clear-cut a tract of land rather than when paying per tree felled c. Drivers of heavier, safer cares are more likely to run stop signs d. workers paid an hourly wage work harder than those on commission
Which of the following conditions is true for a nation operating at a point lying inside its production possibilities curve?
a. The nation is experiencing a technological breakthrough in one of its key industries. b. The nation is clearly utilizing its resources efficiently. c. The nation is producing the maximum output that can be produced with a limited quantity of resources. d. The nation is not utilizing its resources efficiently. e. The nation is producing the maximum output that can be produced with its unlimited quantity of resources.
In this graph for positive externalities in consumption, the efficient equilibrium point is at ______.
a. point A
b. point B
c. P1 and Q1
d. P2 and Q2