Refer to Figure 5-1. Suppose the current market equilibrium output of Q1 is not the economically efficient output because of an externality. The economically efficient output is Q2. In that case, the diagram shows
A) the effect of an external cost imposed on a producer.
B) the effect of a positive externality in the production of a good.
C) the effect of a negative externality in the production of a good.
D) the effect of an external benefit such as a subsidy granted to consumers of a good.
C
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The above table shows some of the balance of payments accounts for Urland. What is Urland's balance on the capital and financial account?
A) -$146 billion B) -$183 billion C) -$99 billion D) $142 billion
Refer to the accompanying figure. For the nation whose PPC is shown, it must be true that:
A. the nation's productive resources are better-suited to making milk than to making movies. B. some of the nation's productive resources are better-suited to making milk, and some are better-suited to making movies. C. the nation's productive resources are better-suited to making movies than to making milk. D. the nation has a comparative advantage in making milk.