Which of the following is false?
a. The nature of public goods is such that the government cannot accurately assess the benefits of those affected.
b. National defense and flood control are illustrations of public goods
c. Just as in the case of external costs, public goods tend to be underprovided by the private sector.
d. All of the above are true.
c
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Governments sometime create an excess demand for a product by setting a maximum price that is less than the equilibrium price, resulting in a permanent excess demand for the product. This is known as a price floor
Indicate whether the statement is true or false
The above figure shows the apartment rental market in Bigtown. If the Bigtown Housing Authority imposes a rent ceiling of $500 per month, the rent ceiling will help
A) all renters. B) some renters and hurt other renters. C) all landlords. D) some landlords and hurt other landlords.
As a result of the 2007-2009 financial crisis, which two firms became bank holding companies, allowing them to engage in commercial banking activities?
A) Lehman Brothers and Merrill Lynch B) Freddie Mac and Fannie Mae C) Morgan Stanley and Goldman Sachs D) Enron and WorldCom
Explain briefly PPP and IRP. Why might the latter hold better than the former over time?
What will be an ideal response?