Sec 10.1 MC Externalities and Market Inefficiency

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1、1. Ifanexternalityispresentinamarket,economicefficiencymaybeenhancedby a. increasedcompetition. b. weakeningpropertyrights. c. betterinformedmarketparticipants. d. governmentintervention.ANSWER:  dDIFFICULTY:  EasyLEARNING OBJECTIVES:  ECON.MANK.097-Examin

2、etheeffectsofanexternalityonamarket.TOPICS:  ExternalitiesPubliceconomicsWelfareeconomicsKEYWORDS:  BLOOM'S:ApplicationCUSTOM ID:  001.10.1-MC-MANK082. Externalitiestendtocausemarketstobe a. inefficient. b. unequal. c. unnecessary. d. overwhelmed.ANSWER:  

3、aDIFFICULTY:  EasyLEARNING OBJECTIVES:  ECON.MANK.097-Examinetheeffectsofanexternalityonamarket.TOPICS:  ExternalitiesPubliceconomicsWelfareeconomicsKEYWORDS:  BLOOM'S:ApplicationCUSTOM ID:  002.10.1-MC-MANK083. Privatemarketsfailtoaccountforexternalitiesb

4、ecause a. externalitiesdon'toccurinprivatemarkets. b. sellersincludecostsassociatedwithexternalitiesinthepriceoftheirproduct. c. decisionmakersinthemarketfailtoincludethecostsoftheirbehaviortothirdparties. d. thegovernmentcannoteasilyestimatetheoptimalquan

5、tityofpollution.ANSWER:  cDIFFICULTY:  ModerateLEARNING OBJECTIVES:  ECON.MANK.097-Examinetheeffectsofanexternalityonamarket.TOPICS:  PubliceconomicsExternalitiesKEYWORDS:  BLOOM'S:ApplicationCUSTOM ID:  003.10.1-MC-MANK084. Ifasawmillcreatestoomuchnoisefo

6、rlocalresidents, a. noiserestrictionswillforceresidentstomoveoutofthearea. b. asenseofsocialresponsibilitywillcauseownersofthemilltoreducenoiselevels. c. thegovernmentcanraiseeconomicwell-beingthroughnoise-controlregulations. d. thegovernmentshouldavoidint

7、erveningbecausethemarketwillallocateresourcesefficiently.ANSWER:  cCopyrightCengageLearning.PoweredbyCognero.Page 71DIFFICULTY:  ModerateLEARNING OBJECTIVES:  ECON.MANK.191-Givenascenariodescribinganexternality,identifytheappropriatepublicpolicytointernali

8、zethatexternality.TOPICS:  PubliceconomicsNegativeexternalitiesKEYWORDS:  BLOOM'S:ApplicationCUSTOM ID:  004.10.1-MC-MANK085. Alteringincentivessothatpeopletakeaccountoftheexternaleffectsoftheiractions a. isc