When a paper producer pollutes the air, economists argue that there is
A) efficiency, if production is at its maximum level.
B) a positive externality.
C) an external cost.
D) a cost paid solely by the firm.
Answer: C
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Which of the following investments can be classified as specific assets?
a. Opening a restaurant in the business district of a city. b. Purchase of additional cotton bales expecting a rise in demand for cotton garments. c. Leasing out land in a tourist spot to build a retail outlet. d. Purchasing specialized equipment for a hydro-electric power project that will not produce electricity at a different location.
During a period of price stability our money supply performs
A. all of its jobs very well. B. some of its jobs very well. C. all of its jobs very poorly. D. none of its jobs very poorly.