Which of the following activities, if any, represents an external cost?
a. The reduction in the incidence of chicken pox when children are inoculated against the disease.
b. The damage to a person's health from secondhand smoke
c. The increase in local property values when the city creates a neighborhood park.
d. The price you pay for the prime rib that you consume at a local restaurant.
b
Economics
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This factor contributes to the winner's curse
a. your estimate of the value of the object was the most optimistic b. your bid was not the highest c. there were not many other bidders you had to beat out d. you shaded your bid too much
Economics
When the price of penicillin tablets increases by $5 per dozen, the drug company’s revenue increases by $6 million. Its elasticity of demand (in absolute terms) must be
A. zero. B. greater than one. C. less than one. D. infinitely large.
Economics