When externalities are present in the market, what results?
a) The established equilibrium maximizes the total benefit to society as a whole.
b) Market participants lose some market benefits to bystanders.
c) Both equity and efficiency are maximized.
d) The market fails to allocate resources efficiently.
Ans: d) The market fails to allocate resources efficiently.
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Which of the following statements is true?
A) Nations have generally moved toward freer international trade policies over the past few decades. B) Nations all over the world have recently raised trade barriers. C) Eastern Europe and the Former Soviet Union countries have reduced trade in the last couple of decades. D) NAFTA lowered trade barriers between the United States and Mexico but raised them between the United States and Canada.
A business organization that employs resources to produce goods and services for profit is
A) economic rent. B) a firm. C) inside information. D) the opportunity cost of capital.