Set 2

Home > Preview

The flashcards below were created by user dwrght16 on FreezingBlue Flashcards.


  1. Based on your conversations today and your economics​ experience, you conclude that when externalities are​ present
    The free market outcome is not efficient
  2. Furthermore, you conclude that when there are negative externalities​ present, free markets
    produce too much
  3. When there are positive externalities​ present, free markets
    produce to little
  4. The Coase Theorem states that​ ___________
    private bargaining will result in an efficient allocation of resources.
  5. The Coase Theorem will will breakdown when​ ____________
    • -When property rights are not clearly defined.
    • -Transaction costs become high.
    • - there are a large number of agents.
  6. From an efficiency​ perspective, Jones ____ allowed to play his opera music.
    should
  7. According to the Coase​ Theorem ____ to compensate for the
    jones will pay $0 to smith, negative externally
  8. According to the Coase Theorem, _____ to compose for the ____
    jones will pay $60 to smith, negative externality
  9. The government could encourage the production of the efficient number of ITNs by​ ____________
    providing a subsidy for ITNs.
  10. This outcome ___ socially efficient
    is not

Card Set Information

Author:
dwrght16
ID:
330202
Filename:
Set 2
Updated:
2017-04-08 00:29:45
Tags:
econ
Folders:

Description:
exam 3
Show Answers:

Home > Flashcards > Print Preview