Generating electricity creates air pollution. This industry, if left unregulated, will produce at an inefficient market equilibrium where
A) marginal private cost equals marginal social benefit.
B) marginal social cost equals marginal social benefit.
C) marginal social cost equals marginal private cost.
D) marginal social benefit is greater than marginal social cost.
A
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Referring to Table 12.2, if the nominal interest rate is 8.5 percent and there is no inflation, which investments will be undertaken?
A) D, E B) E C) C, E D) none of the above
Which of the following statements about perfectly competitive markets is not correct?
a. In the short run, firms can earn economic profits or suffer economic losses. b. The market demand curve is downward sloping. c. The demand curve facing an individual firm is perfectly elastic. d. In the long run, firms can earn economic profits or suffer economic losses. e. In the long run, firms can enter or exit the market.