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Microeconomics Study Set 27

Business

Quiz 16 :

Market Failures and Government Intervention

Quiz 16 :

Market Failures and Government Intervention

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The essential coordinating mechanism of a free- market economy is
Free
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C

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Examples of direct costs of government intervention include
Free
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B

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In a free- market system,a disequilibrium in one market
Free
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D

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The diagram below shows the marginal benefit and marginal cost of a public good.This economy has 3 individuals,A,B and C.The diagram shows the MB for each individual and a summation of their marginal benefits. img FIGURE 16- 4 -Refer to Figure 16- 4.Once some quantity of this public good is provided,the efficient price to charge for its use is
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Moral hazard is said to exist when one party to a transaction
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An example of a common- property resource is
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Services such as those within the justice system are usually provided by the government.What broader social goal is being met in this case?
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Export Development Canada (EDC)provides insurance to Canadian exporters for their accounts receivable from foreign buyers.If EDC charges an insurance premium that reflects the average level of risk of the exporting firms,it is only the most risky firms that will tend to purchase insurance.This is an example of
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Which of the following statements about market economies is true?
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The "formal defence" of free markets includes the argument that competitive markets
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FIGURE 16- 1 img -Refer to Figure 16- 1.Suppose the perfectly competitive market with no government intervention achieves equilibrium at point A.If the social marginal costs and social marginal benefits are represented by MC0 and MB0,respectively,then there exists
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The concept of "institution building" is becoming more prominent.Which of the following best describes the aim of institution building?
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A free- market economy with perfect allocative efficiency does not exist in reality because
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An efficient level of provision of a public good is achieved when
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The "informal defence" of free markets includes the argument that markets
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All Canadian provincial governments have legislated minimum wages.What broader social goal is being met in this case?
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FIGURE 16- 1 img -Refer to Figure 16- 1.Suppose that the perfectly competitive market with no government intervention achieves equilibrium at point A.If the social marginal costs and social marginal benefits are represented by MC0 and MB1,respectively,then the competitive equilibrium quantity is
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Which of the following best describes the reason for over fishing in Canadian offshore fisheries?
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In economics,the term "public good" refers to a product
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A plausible example of market failure due to an externality is
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