A positive externality is internalized when
A. demand shifts to the right until the socially optimum level of output is obtained.
B. demand shifts to the left until the socially optimum level of production is obtained.
C. supply shifts to the left until the socially optimum level of production is obtained.
D. b and c
E. none of the above
Answer: A
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Amy can produce either 5000 pounds of cheese or 20 cars per year. Mike can produce either 5000 pounds of cheese or 10 cars per year. Amy's opportunity cost of producing one car is ________ pounds of cheese.
A. 250 B. 1/20 C. 1/250 D. 20
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Earth Movers & Shakers operates 3 iron ore mines. The accompanying table shows each mine's total daily production and the current number of miners at each mine. All miners work for the same wage, and each miner in any given mine produces the same number of tons per day as every other miner in that mine. Total Tons Per DayNumber of MinersMother Lode10025Scraping Bottom3010Middle Drift7515 Suppose Earth Movers & Shakers needs to fill an order for 60 tons of ore in a single day. If it has no other orders for that day, it should:
A. take it all from Mother Lode. B. take it all from Middle Drift. C. take 20 tons from each of the three mines. D. take 30 tons from Scraping Bottom and 30 tons from Middle Drift.
There are several advantages that a market economy possesses. These do not include the fact that market economies:
A) tend to result in high living standards. B) tend to encourage greater economic growth. C) tend to prevent entrepreneurial activity that would result in large accumulations of wealth in the hands of a few people. D) none of the above is true