When a negative externality exists, the private market produces
A) products at a low opportunity cost.
B) less than the economically efficient output level.
C) products at a high opportunity cost.
D) more than the economically efficient output level.
D
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Which of the following is a TRUE statement about stock markets?
A) Economists can make above-average profits in the stock market because of their specialized knowledge of economics. B) It is always better to buy growth stocks than the older and more stable blue-chip stocks. C) The stock market on average over time is random and totally unrelated to the performance of the economy. D) It is illegal for a friend of a corporate executive to make large profits in the stock market by using his inside information.
If a monopolist were to produce in the inelastic segment of its demand curve:
A. total revenue would be at a maximum. B. marginal revenue would be positive. C. the firm would not be maximizing profits. D. it would necessarily incur a loss.