Which of the following is an example of an external benefit?
A) a ton of coal burned in a power plant to produce electricity
B) a car accident that crowds a major Los Angeles freeway
C) the production of a slice of pizza
D) the cleanup of a large lake
E) the consumption of a can of Mountain Dew
D
Economics
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Whether or not people have identical tastes, the net value that the marginal user receives from a common property is
a. positive. b. zero. c. negative. d. uncertain.
Economics
Suppose that Abdul opens a coffee shop. He receives a loan from a bank for $100,000. He withdraws $50,000 from his personal savings account. The interest rate on the loan is 8%, and the interest rate on his savings account is 2%. Refer to Scenario 13-4. Abdul’s explicit cost of capital is
a. $8,000. b. $4,000. c. $2,000. d. $1,000.
Economics