According to the Coase theorem, externalities
A. must usually be internalized by taxation or subsidy.
B. can be internalized by the market under certain conditions.
C. result when firms fail to maximize profits.
D. cannot be internalized if property rights are assigned.
E. are not relevant to the issue of market failure.
Answer: B
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Any change that causes a decrease in the demand for labor at a given wage rate will be represented by a(n) ________, assuming all else equal
A) rightward shift in the labor demand curve B) downward movement along the labor demand curve C) upward movement along the labor demand curve D) leftward shift in the labor demand curve
The London gold fixing is an example of a(n)
A) dealer market. B) Walrasian auction market. C) brokered market. D) secondary market.
The current price of a government bond is $920. The bond pays $90 in interest this year. At the end of the current year, the bond matures, and the principal of $1,000 is repaid. What is the return to the holder of this bond?
A) 1 percent B) 8 percent C) 9 percent D) 17 percent
Producing a soccer ball costs Jake $5 . He sells it to Darby for $35 . Darby values the soccer ball at $50 . For this transaction, the total surplus in the market is $40
a. True b. False Indicate whether the statement is true or false