If education produces positive externalities and the government does not intervene in the market, we would expect
a. the market equilibrium price to be higher than the efficient equilibrium price
b. the market equilibrium quantity to be lower than the efficient equilibrium output level.
c. the market equilibrium quantity to be higher than the efficient equilibrium output level.
d. none of the above
b
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An HMO hires radiology services from India to cut costs. If all else remains equal, this will
A) decrease the financial account. B) decrease the balance of trade. C) increase the current account balance. D) decrease net exports.
Suppose a perfectly competitive firm faces the following cost and revenue conditions: ATC = $25.50; AVC = $20.50; MC = $25.50; MR = $28.50. The firm should
A) decrease output. B) increase output. C) shut down. D) continue to produce its current output.