Ready to test your Knowledge?
Try out our new practice tests completely free!
exam preparation banner icon

Macroeconomics Study Set 43

Business

Quiz 4 :

B: Market Failures: Public Goods and Externalities

Quiz 4 :

B: Market Failures: Public Goods and Externalities

search
arrow
A demand-side market failure occurs when demand curves do not reflect consumers' full willingness to pay for a good or service.
Free
True False
Answer:

Answer:

True

arrow
Market for asparagus.At the market price of $2, area A represents: img
Free
Multiple Choice
Answer:

Answer:

C

arrow
Consumer surplus and the market price are positively related.
Free
True False
Answer:

Answer:

False

arrow
A demand-side market failure occurs when demand curves do not reflect consumers' lack of willingness to pay for a good or service.
True False
Answer:
arrow
Productive efficiency means that the society is producing the combination of the output most desirable by consumers.
True False
Answer:
arrow
Market failures
Multiple Choice
Answer:
arrow
Supply-side market failure
Multiple Choice
Answer:
arrow
A supply-side market failure occurs when supply curves do not reflect the full cost of producing a good or service.
True False
Answer:
arrow
Market for asparagus.At the market price of $2, area A + B represents: img
Multiple Choice
Answer:
arrow
Refer to the diagram.The area of consumer surplus would be represented by triangular area: img
Multiple Choice
Answer:
arrow
There is a positive relationship between equilibrium price and the amount of producer surplus.
True False
Answer:
arrow
If there are significant external benefits associated with the production or consumption of a good or service, there will be an under-allocation of resources to its production unless some corrective action is taken.
True False
Answer:
arrow
Society's optimal amount of pollution moderation is where society's marginal benefit of moderation is zero.
True False
Answer:
arrow
Cost-benefit analysis is frequently difficult to apply because it is difficult to quantify the full benefits of a public good or service.
True False
Answer:
arrow
Society's marginal cost of pollution moderation curve slopes upward because of the law of diminishing marginal utility.
True False
Answer:
arrow
Market failure
Multiple Choice
Answer:
arrow
The principle that private negotiation can resolve potential externalities without resort to government intervention is known as the Coase Theorem.
True False
Answer:
arrow
A demand curve for a public good is determined by summing horizontally the individual demand curves for the public good.
True False
Answer:
arrow
The optimal quantity of a public good occurs where the marginal benefit of the citizen who has the highest preference for the good just equals the good's marginal cost.
True False
Answer:
arrow
Demand-side market failure
Multiple Choice
Answer:
Showing 1 - 20 of 133