Suppose that candy producers create a positive externality equal to $1 per pound of candy. Further suppose that the government offers a $1-per-pound subsidy to the producers. What is the relationship between the equilibrium quantity and the socially optimal quantity of candy?
a. The equilibrium quantity is greater than the socially optimal quantity.
b. The equilibrium quantity is less than the socially optimal quantity.
c. They are equal.
d. There is not enough information to answer the question.
c
Economics
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Which of the following is correct concerning the open-economy macroeconomic model?
a. The net-capital-outflow curve slopes upward. b. The key determinant of net capital outflow is the real exchange rate. c. The supply of dollars in the market for foreign-currency exchange is vertical. d. None of the above is correct.
Economics
All of the following are advertisement methods EXCEPT
A. direct marketing. B. mass marketing. C. indirect marketing. D. interactive marketing.
Economics