John paints the exterior of his house and, as a result, his neighbor Christine is able to sell her home for $5,000 more than she could have before. John's house painting
a. creates a negative externality for Christine
b. makes John a free rider
c. results in an efficient market outcome for both parties since both benefit
d. creates a positive externality for Christine
e. was poorly done
D
You might also like to view...
The above figure shows Jane's budget line and two of her indifference curves. Which of the following happens to Jane's budget line if there were an increase in her monthly dining-out budget?
A) It would bend toward the origin, becoming more convex. B) It would bend away from the origin, becoming more concave. C) It would shift rightward and not change its slope. D) It would shift leftward and not change its slope.
A seller's reservation price is generally equal to:
A. the seller's opportunity cost of producing an additional unit. B. the buyer's reservation price. C. the seller's marginal benefit from producing an additional unit. D. the market price.
Assuming the free flow of capital, explain why the central bank of a country that has fixed its exchange rate would not find discussions of inflation on the agenda of its policy meetings.
What will be an ideal response?
Marginal Revenue is
A. the revenue associated with the first unit of sales. B. the extra cost associated with one additional unit of output. C. the extra revenue associated with one additional unit of sales. D. the revenue associated with the sale of the average unit.