National defense is provided by the government because
a. it is impossible for private markets to produce public goods.
b. products provided by the government are produced more efficiently.
c. free-riders make it difficult for private markets to supply the socially optimal quantity.
d. public goods increase government revenues.
c
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Which of the following is the most important advantage of using money rather than relying exclusively on barter?
A) The use of money encourages people to diversify and learn to do more things for themselves. B) The use of money encourages people who want to exchange to become more closely acquainted. C) The use of money lowers the cost of locating people with whom to exchange. D) The use of money reduces opportunities for fraud and theft. E) The use of money reduces selfishness because money in itself has no value.
Refer to the normal-form game of price competition in the payoff matrix below.Firm AFirm B??Low PriceHigh Price?Low Price0,050,-10?High Price-10,5020,20Suppose the game is infinitely repeated, and the interest rate is 10 percent. Both firms agree to charge a high price, provided no player has charged a low price in the past. If both firms stick to this agreement, then the present value of firm A's payoffs are:
A. 550. B. 330. C. 110. D. 220.