Which of the following is true?

Which of the following is true?
 a. The private market provides too much of goods that generate external benefits.
 b. In the case of external benefits, if we could add the benefits that are derived by non-paying consumers, the supply curve would shift to the right, increasing output.
  c. In the case of external benefits, a tax equal to external benefits would result in an efficient level of output.
  d. In the case of public goods, when people act as free-riders, some goods having benefits greater than costs will not be produced.

Question 2

When a country allows trade and becomes an importer of goods everyone benefits.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 3

Countries import goods in which they have:
 a. an absolute advantage.
  b. a comparative advantage.
  c. a reputation for good product quality.
  d. a comparative disadvantage.
  e. a surplus domestic production.

Question 4

If the government overcorrected in a situation of external costs
 a. More than the efficient amount of the good would end up being produced.
 b. Less than the efficient amount of the good would end up being produced.
 c. It would result in a welfare cost in that market that was bigger than the initial welfare cost.
  d. Both a and c are would result.

Question 5

When a country allows trade and becomes an exporter of goods, producers gain more than consumers lose.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 6

The difference between absolute and comparative advantage is that:
 a. absolute advantage refers to input cost, while comparative advantage refers to opportunity cost.
  b. absolute advantage refers to opportunity cost, while comparative advantage refers to input cost.
  c. absolute advantage refers to individuals, and comparative advantage refers to countries.
  d. absolute advantage refers to countries, and comparative advantage refers to individuals.
  e. absolute advantage is applicable to intranational trade, while comparative advantage applies to international trade.

Question 7

If the government overcorrected in a situation of external costs
 a. More than the efficient amount of the good would end up being produced.
  b. Less than the efficient amount of the good would end up being produced.
  c. It would result in a welfare cost in that market.
 d. Both b and c are would result.

Question 8

When a country allows trade and becomes an exporter of goods consumers gain more than producers lose.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 9

For purposes of determining comparative advantage, the cost of producing a good in each of two countries is measured in terms of:
 a. metric units only.
  b. opportunity costs.
  c. total costs.
  d. the currency of the importing country.
  e. the currency of the exporting country.

Question 10

Which of the following are true?
 a. Negative externalities are real costs, but, unlike the other resources a firm uses in production, no one owns the air, so a firm does not have to pay for its use.
  b. In the case of external costs, firms tend to produce too much from society's standpoint, causing an efficiency loss due to an overallocation of scarce resources to the production of the good.
  c. If government could impose a pollution tax equal to the exact size of the external costs imposed by a firm, then the firm would produce at the socially desired level of output.
  d. All of the above are true.