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A competitive firm’s short-run supply curve is its marginal cost curve above its average variable cost curve. ( )

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When the government levies a tax on a good equal to the external cost associated with the good’s production, it _ the price paid by consumers and makes the market outcome _ efficient. ( )

A. increases, more
B. increases, less
C. decreases, more
D. decreases, less

The free-rider problem ( )

A. forces supply of a public good to exceed demand.
B. allows more people to pay for the public good than if it were a private good.
C. encourages overuse of a good that is freely available.
D. holds the equilibrium quantity of a public good below the economically efficient level.

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Which categories of goods are excludable? ( )

A. private goods and club goods
B. private goods and common resources
C. public goods and club goods
D. public goods and common resources

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What is true of a monopolistically competitive market in long-run equilibrium? ( )

A. Price is greater than marginal cost.
B. Price is equal to marginal revenue.
C. Firms make positive economic profits.
D. Firms produce at the minimum of average total cost.

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A competitive firm’s short-run supply curve is its marginal cost curve above its average variable cost curve. ( )

When the government levies a tax on a good equal to the external cost associated with the good’s production, it ___________ the price paid by consumers and makes the market outcome ___________ efficient. ( )

The free-rider problem ( )

Which categories of goods are excludable? ( )

What is true of a monopolistically competitive market in long-run equilibrium? ( )

When the government levies a tax on a good equal to the external cost associated with the good’s production, it _ the price paid by consumers and makes the market outcome _ efficient. ( )