With respect to monopolistic competition,
a. both the business-stealing externality and the product-variety externality are positive externalities.
b. the business-stealing externality is a positive externality, while the product-variety externality is a negative externality.
c. the business-stealing externality is a negative externality, while the product-variety externality is a positive externality.
d. both the business-stealing externality and the product-variety externality are negative externalities.
c
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One reason for the extraordinary growth of foreign financial markets is
A) decreased trade. B) increases in the pool of savings in foreign countries. C) the recent introduction of the foreign bond. D) slower technological innovation in foreign markets.
Two advisors to the president have given their policy recommendations, and they are in disagreement. Why do these economists disagree?
a. because they do not have all relevant information about the problem b. because they disagree on the nature of some cause-effect relationship c. because they have different values and opinions d. All of the above are reasons for disagreements among economists.