For each of the following examples, identify whether a positive or negative externality is present and whether there will be too little or too much of the activity relative to the socially optimal outcome. A. Jerome has a beautifully landscaped front lawn with lots of colorful flowers. Landscaped lawns produce a externality. landscaped lawns exist relative to the socially efficient quantity.
B. Dave takes advantage of the low price of gas to purchase a sports utility vehicle. Sports utility vehicles generate a externality. sports utility vehicles are produced relative to the socially efficient quantity.
C. Susan decides to walk to work instead of driving. Walking to work creates a externality. walks to work exist relative to the socially efficient quantity.
D. Anita decides to smoke a cigarette while she is waiting at a busy bus stop. Cigarettes create a externality. cigarettes are produced relative to the socially efficient quantity.

Consider the local telephone company, a natural monopoly. the following graph shows the monthly demand curve for phone services and the company’s marginal revenue (mr), marginal cost (mc), and average total cost (atc) curves. 0 2 4 6 8 10 12 14 16 18 20 100 90 80 70 60 50 40 30 20 10 0 price (dollars per subscription) quantity (thousands of subscriptions) d mr mc atc 8, 60 suppose that the government has decided not to regulate this industry, and the firm is free to maximize profits, without constraints. complete the first row of the following table. pricing mechanism short run long-run decision quantity price profit (subscriptions) (dollars per subscription) profit maximization marginal-cost pricing average-cost pricing suppose that the government forces the monopolist to set the price equal to marginal cost. complete the second row of the previous table. suppose that the government forces the monopolist to set the price equal to average total cost. complete the third row of the previous table. under average-cost pricing, the government will raise the price of output whenever a firm’s costs increase, and lower the price whenever a firm’s costs decrease. over time, under the average-cost pricing policy, what will the local telephone company most likely do

Which of the following statements regarding the southern economy at the end of the nineteenth century is accurate? the south was producing as much cotton as it had before the civil war.

Exhibit 34-1 country a country b good x 90 60 30 0 good ygood x good y 0 30 60 90 30 20 10 20 40 60 refer to exhibit 34-1. considering the data, which of the following term to? a. 1 unit of y for 1 unit of x b. 1 unit of y for 0.75 units of x c. 1 unit of y for 0.25 units of x d. 1 unit of y for 1.50 units of x e. all of the above s of trade would both countries agree 8. it -