A monopolistically competitive firm and a monopoly are alike because both I. face downward sloping demand curves. II. have marginal revenue curves that lie beneath their demand curves. III. can make an economic profit in the long run
A) I only.
B) I and II.
C) I, II, and III.
D) I and III.
B
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When a Clarke tax is used to finance a public good, each person's tax equals
a. the amount that he is willing to pay for the good. b. the difference between the value he places on the public good and its cost. c. the cost of the public good minus the value that other people claim to receive from it. d. everyone else's tax, with the sum equaling the cost of producing the public good.
If the unemployment rate rises, which policies would be appropriate to reduce it?
a. increase the money supply, increase taxes b. increase the money supply, cut taxes c. decrease the money supply, increase taxes d. decrease the money supply, cut taxes
For a negative externality, the _________ than the costs imposed on society as a whole.
Fill in the blank(s) with the appropriate word(s)
Suppose there are three nations (North, South, and East) and three goods (A, B, and C). Given resources and technology, North can produce 5 units of A, or 2 units of B, or 10 units of C, or any linear combination thereof. South can produce 5 units of A, or 2 units of B, or 5 units of C, or any linear combination thereof. East can produce either 1 unit of A, or 5 units of B, or 10 units of C, or any linear combination thereof. The most efficient pattern of specialization is to have
a) North produce A, South produce B, and East produce C b) North produce A, South produce C, and East produce B c) South produce A, North produce B, and East produce C d) South produce A, North produce C, and East produce B e) East produce A, South produce B, and North produce C