Externalities affect only the buyer and seller involved in an exchange
a. True
b. False
Indicate whether the statement is true or false
False
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Collusion is undesirable and illegal because
A. Government intervention leads to inefficient outcomes. B. It is unprofitable and the government must bail out firms that are bankrupted by collusion. C. Resources are misallocated and the level of output is restricted. D. It leads to greater production than would occur in a competitive market.
There is an increase in incomes due to a tech boom. Which of the following correctly captures the effect of this change on the market for gasoline?
A. Equilibrium quantity will increase, but equilibrium price will decrease. B. Both equilibrium quantity and price will decrease. C. Equilibrium quantity will decrease, but equilibrium price will increase. D. Both equilibrium quantity and price will increase.