A negative externality will cause a private market to produce
a. less than is socially desirable.
b. more than is socially desirable.
c. exactly the quantity that is socially desirable.
d. less than the same market would produce in the presence of a positive externality.
b
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Assume that when the price of good X is $12, quantity demanded is 32. When price is decreased to $9, quantity demanded increases to 45. Over this range, the arc elasticity of demand is 1.182
Indicate whether the statement is true or false
In the market for land as a resource, the demand curve is elastic while the supply curve is perfectly inelastic. Identify the underlying assumption
a. There are limited ways in which land can be used as a resource. b. Land as an input has large number of substitutes. c. There is a fixed supply of land. d. Land includes all immovable assets. e. The productivity of land improves over time.