Markets, Efficiency And The Public Interest

A. Pareto goods
B. public goods
C. private goods
D. free goods

A. When firms are not profit maximisers
B. When firms have some control over price and competition
C. When the consumption of the good involves an external benefit
D. Whenever firms are losing money.

A. efficiency analysis
B. partial equilibrium analysis
C. general equilibrium analysis
D. equity analysis

A. decision makers do not take them into account
B. all firms are perfectly competitive
C. the externalities are negative
D. all firms are monopolistic

A. Marginal benefit equals marginal damage cost
B. marginal benefits equals marginal social cost
C. marginal benefit equals marginal private cost
D. marginal social cost equals marginal external cost

A. technically efficient.
B. inefficient.
C. potentially efficient
D. unequivocally Pareto optimal

A. elected officials will act selflessly for the good of society and ignore their own self interest
B. the managers of government agencies are trying to maximize the profit of their agency and they ignore the implications that this has on other departments
C. the optimal level of public goods may be too expensive for the society to produce
D. the measurement of social damages and benefits is difficult and imprecise

A. The coase theorem
B. Arrow’s impossibility theorem
C. the drop -in-the bucket problem.
the free rider problem

A. non-rivalry
B. the free-rider problem
C. the Coase theorem
D. the fallacy of composition

A. limitless in utility
B. non-rival in consumption
C. congestible in consumption
D. non-excludable