Which of the following is true?
A) The market demand curve for a public good has a positive slope.
B) The market demand curve for a private good has a positive slope.
C) The market demand curve for a public good is arrived at by the horizontal sum of individual demand curves.
D) The market demand curve for a public good is arrived at by the vertical sum of individual demand curves.
D
You might also like to view...
In the short run, why would a firm in a perfectly competitive market shut down production if the prevailing market price falls below the lowest possible average variable cost?
a. At that point (economic) profit is zero. b. Below that point average revenue becomes less than marginal revenue. c. Below that point marginal revenue becomes insufficient to pay for avoidable average variable cost. d. Below that point other firms with similar cost will find it profitable to enter the market and take away demand from the existing firms.
Which of the following is a valid reason for the government rather than the market to finance the provision of certain economic goods and services? a. When the government provides economic goods, they are free; costs are incurred when such goods are provided by private firms. b. Voters tend to be better informed than market consumers are
c. Decision makers in the market sector are motivated by self-interest, whereas political decision makers are primarily motivated by altruism (the desire to help others). d. Public goods tend to be undersupplied through the market since it is difficult for potential suppliers to withhold such goods from nonpaying consumers; the government can use taxes to overcome this problem of nonpayment.