Practice MT #2SECTION I MULTIPLE CHOICEThere are 5 different MC #1. Do only the one for the chapter you read. Indicate on theanswer document which optional chapter you did.(Chapter 10) 1. Determine whether or not the following statements are true based on the graph below:I. There is a negative externality associated with the production of this goodII. The quantity produced in a perfectly competitive market for this good is below the efficient quantity of the goodIII. A corrective tax of the right magnitude could cause a perfectly competitive market to produce the efficient quantity of the good.a) Only I is correctb) Only II is correctc) Only I and III are correctd) Only II and III are correcte) All 3 are correct
(Chapter 11) 1. Determine whether or not the following statements are true about a publiclake that people use for recreational fishingI. The fish in the lake are considered rival and non-exclusive.II. Requiring a fishing license and setting catch limits is one method of solving this tragedyof the commons.III. Rules of the free market tell us than in this situation, letting each person decide how many fish they want to catch will result in the socially efficient number of fish being caught.
(Chapter 15) 1. Determine whether or not the following are true based on the picture of the natural monopoly given below