A cost-benefit analysis can be done to assess whether a nation should fix its exchange rate. Which of the following is NOT correct?
A) If market integration or symmetry increase, then the net benefits of a fixed exchange rate increase.
B) If the net benefits are negative, economically speaking the nation should float.
C) If the net benefits are positive, economically speaking the nation should float.
D) If the net benefits turn negative, the nation should fix.
Ans: B) If the net benefits are negative, economically speaking the nation should float.
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Accounting profits at a firm's break-even point are
A) positive. B) negative. C) zero. D) indeterminate since we need to know what demand is.
University researchers create a positive externality because what they discover in their research labs can easily be learned by others who haven't contributed to the research costs. What could the federal government do to equate the equilibrium quantity of university research and the socially optimal quantity of university research produced?
a. tax university researchers b. offer grants to university researchers c. eliminate subsidized student loans d. nothing