Micro test5

Micro test5 - 1) If some activity creates positive...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
1 ) If some activity creates positive externalities as well as private benefits, then economic theory suggests that the activity ought to be:  (6.7pts) subsidized. + 2 ) Private goods are characterized by:  (6.7pts) rivalry and excludability. + 3 ) Market failure occurs when:  (6.7pts) . the competitive market system under- or over allocates resources to  production + 4 ) Private firms cannot profitably produce a public good because of:  (6.7pts) nonrivalry and nonexcludability. + 5 ) When a person's income increases from $40,000 to $50,000 a year and tax payments increase from $3,000 to $6,000, the person's marginal tax rate is:  (6.7pts) 20 percent. +
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
6 ) If an economy is being "productively efficient," then that means the economy is:  (6.7pts) fully employing all economic resources. + 7 ) A public good:  (6.7pts)
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 3

Micro test5 - 1) If some activity creates positive...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online