Externalities require government intervention when
A. violence will result between disputing parties.
B. there are only a few sellers in the market.
C. property rights are not clearly established.
D. the government imposes sales taxes.
E. all of these answer options are correct.
C. property rights are not clearly established.
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Economists are trained to be as:
A. subjective as they can be. B. opinionated as they can be. C. deconstructionist as they can be. D. objective as they can be.
The demand for good X is estimated to be Qxd = 10, 000 ? 4PX + 5PY + 2M + AX, where PX is the price of X, PY is the price of good Y, M is income, and AX is the amount of advertising on X. Suppose the present price of good X is $50, PY = $100, M = $25,000, and AX = 1,000 units. Based on this information, the income elasticity of good X is:
A. 0.008. B. 0.82. C. 0.082. D. 8.2.
Alicia spends $20,000 on remodeling a storefront that she then opens as a flower shop. Her business has not been very successful, and she needs an additional $8,000 to keep the flower shop. Which of the following is true?
A. The $8,000 Alicia needs to keep the flower shop open represents her total fixed costs. B. The $20,000 Alicia spent on remodeling represents a part of the total variable cost of her business. C. The $20,000 Alicia spent on remodeling is a fixed cost of her business. D. The $8,000 represents her marginal costs of production.
Higher domestic interest rates encourage
A. U.S. investors to invest abroad. B. foreign investors to withdraw their funds from U.S. investment. C. U.S. investors to withdraw their funds from foreign investment.