Nonexcludable goods tend to be undersupplied because:
A. people do not pay the true value of the good.
B. the free rider problem persists.
C. people rarely willingly pay for something they could get for free, regardless of how much they value it.
D. All of these statements are true.
Answer: D
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In the short run, the equilibrium level of real GDP
A) is necessarily less than potential GDP. B) is necessarily equal to potential GDP. C) is necessarily greater than potential GDP. D) could be less than, equal to, or greater than potential GDP.
Assume price exceeds average variable cost over the relevant range of demand. If a monopolistically competitive firm is producing at an output where marginal revenue is $23 and marginal cost is $19, then to maximize profits the firm should
A) continue to produce the same quantity. B) decrease output. C) shut down. D) increase output.
Explain some important policy measures that you would expect to reduce excessive rural-urban migration. Explain
What will be an ideal response?
If getting accepted into college is very difficult because of high standards of intelligence and ability, but students learn absolutely nothing while in college, it is most likely that
A) they will not be hired upon graduation. B) attendance sends a signal to employers regarding ability. C) nobody will want to go to college. D) a college degree is not a credible signal.