University researchers create a positive externality because what they discover in their research labs can easily be learned by others who haven't contributed to the research costs. Suppose that the federal government gives grants to these researchers equal to the their per-unit production externality. What is the relationship between the equilibrium quantity of university research and the
socially optimal quantity of university research produced?
a. The equilibrium quantity is greater than the socially optimal quantity.
b. They are equal.
c. The equilibrium quantity is less than the socially optimal quantity.
d. There is not enough information to answer the question.
b
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Which of the following statements best describes the comparative advantage of the corresponding country regarding the iPhone?
a. The United States has a comparative advantage in designing and marketing products. b. China has a comparative advantage in designing and marketing products. c. Korea has a comparative advantage in producing components. d. China has a comparative advantage in producing components.
The term "present value" refers to the future value of present day money.
A. True B. False C. Uncertain
Which of the following items does not provide a store of value?
a. All of the answers are correct. b. Credit cards c. Currency d. Checkable deposits
On necessities, more of the incidence of tax is
A. borne by the producer. B. borne by the consumer. C. shared equally between the producer and the consumer. D. None of these are correct.