Property rights are protected by
A. rivalry and excludability.
B. bargaining and negotiation.
C. taxes and subsidies.
D. injunctions and liability rules.
Answer: D
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The higher the number of people who have access to e-mail, the more valuable it is to everyone. This is an example of a(n) ________
A) moral hazard B) adverse selection C) network externality D) negative externality
South Korea, Indonesia, Malaysia, and Thailand all pegged their currencies to the dollar at one point in time
Because some of these currencies were overvalued at the pegged rate, speculators anticipated these countries would abandon the peg and speculators began selling those currencies. Explain how this speculation would affect the ability of a country to maintain a pegged exchange rate.
Identify two activities that generate positive externalities and two activities that generate negative externalities. Be sure to explain why each activity you identified generates the type of externality you stated.
What will be an ideal response?
A perfectly competitive industry in long-run equilibrium is described as efficient because firms
A. produce at the low point on their average cost curve. B. produce where marginal cost yields a profit. C. earn no more than the cost of capital. D. are not profitable.