Claudia went to a department store to buy a few things for her new house. She found out that several items in the store were on discount and decided to make the most of the deals offered
However, as she started using the things that she bought, she realized that many of these items were defective. This happened due to: A) the presence of positive externalities.
B) the presence of negative externalities.
C) asymmetric information.
D) moral hazard.
C
Economics
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As the amount of inventories maintained by a firm increases:
A) its elasticity of supply increases. B) its elasticity of supply decreases. C) the elasticity of demand for its product increases. D) the elasticity of demand for its product decreases.
Economics
What is meant by the term "internalizing an externality"? How does a Pigovian tax or subsidy internalize an externality?
What will be an ideal response?
Economics