ARE 201 Lab 2

2 the following statement is an example of positive

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Unformatted text preview: . The following statement is an example of positive economics: a) The procedure under analysis is expected to cost $15,679 with a probability of 95 percent. b) The President's budget is not in the best interest of the country. c) The appropriate action that you "ought to" take for your business is to drop prices10%. d) The Dow Jones is reaching its upper limit given the recent increase in the prime rate. e) None of the above. 2 3 A smoker and a nonsmoker share a small office. The nonsmoker is irritated by cigarette smoke. Is this situation a positive externality or a negative externality? a) Positive externality b) Negative externality 4 Mrs. Smith has the most attractive yard in the neighborhood. Her yard is always mowed and landscaped with flowers. Her neighbors' yards are "average" doing only the minimum to satisfy the requirements of the homeowners association. From Ms. Smith’s neighbor’s perspective, does this situation MOST LIKELY set up the possibility of a positive externality or a negative externality? a) Positive externality b) Negative externality 5 The following is an example of government policy that addresses a positive externality: a) Requiring the use of seat belts while driving or riding in a motor vehicle. b) Regulation on exhaust emissi...
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This lab report was uploaded on 02/19/2014 for the course ARE 201 taught by Professor Eryuruk during the Spring '08 term at N.C. State.

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