11. A firm is generating detrimental externalities when a. MSC is less than MPC.
ID: 1213675 • Letter: 1
Question
11. A firm is generating detrimental externalities when
a.
MSC is less than MPC.
b.
MSC is the same as MPC.
c.
MSC is greater than MPC.
d.
MPC includes some incidental costs.
____ 12. The classic example of a detrimental externality is
a.
education.
b.
pollution.
c.
discovery of an AIDS vaccine.
d.
Mrs. Lewis' prize-winning rose garden.
Figure 15-1
____ 13. Figure 15-1 describes conditions in the monopolized weezil industry. In the absence of government intervention, the monopolist will produce an output equal to
a.
W.
b.
X.
c.
Y.
d.
Z.
____ 14. Figure 15-1 describes conditions in the monopolized weezil industry. If the government replaces the monopolist with perfectly competitive firms and forces these firms to take account of all the costs and benefits they impose on society, the industry will produce an output equal to
a.
W.
b.
X.
c.
Y.
d.
Z.
____ 15. In the case of a beneficial externality
a.
marginal private cost is below marginal social cost.
b.
marginal social cost is above marginal private cost.
c.
marginal social cost and marginal private cost are equal.
d.
the free market price is below the socially efficient price.
____ 16. A true public good is characterized by
a.
depletability but not excludability.
b.
excludability but not depletability.
c.
both depletability and excludability.
d.
neither depletability nor excludability.
____ 17. The "free rider" problem occurs when a good is
a.
not available.
b.
not excludable.
c.
not depletable.
d.
not sold in free markets.
____ 18. National defense and coastal lighthouses are examples of
a.
public goods.
b.
private goods.
c.
high marginal cost goods.
d.
depletable goods.
____ 19. Which of the following is not a public good?
a.
a coastal lighthouse
b.
national defense
c.
a city park playground
d.
the latest Walt Disney movie
____ 20. The cost disease of the service sector is evidenced by
a.
a failure of the market mechanism.
b.
increased quality of public and private services.
c.
dramatic increases in municipal budget burdens for education, health care, and police and fire protection.
d.
the increased productivity in the services area.
a.
MSC is less than MPC.
b.
MSC is the same as MPC.
c.
MSC is greater than MPC.
d.
MPC includes some incidental costs.
Explanation / Answer
11.
MSC is greater than MPC.
as social cost is higher than the private cost as more costs , there will be negative externality that means cost are not fully paid by the businesses in this case
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.