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21 As a market-based society, non-profit firms are illegal in the U.S. True Fals

ID: 1144594 • Letter: 2

Question

21 As a market-based society, non-profit firms are illegal in the U.S.

True

False

22 An externality is a cost or a benefit that falls on third parties and is therefore ignored by the two parties to a market transaction.

True

False

23 Public goods feature rivalry in consumption, meaning that what is consumed by one is no longer available to someone else. In addition, consumption of public goods can easily be limited to paying customers.

True

False

24 Which of the following best describes a market failure (or market failures) that provide(s) an economic rationale for government intervention in markets?

a. Monopoly

b. Public goods

c. Externalities

d. All of these answers are correct.

25 Which of the following is an example of regressive taxation, in which the percentage of income paid in taxes decreases as income increases?

a. U.S. income tax

b. U.S. payroll taxes for Social Security

c. Ad valorem tax

d. Corporate tax

26 International trade occurs because the ________ cost of producing specific goods varies across countries.

a. variable

b. fixed

c. sunk

d. opportunity

27 The balance of payments system is the accounting record of all economic transactions between US residents and residents in the rest of the world.

True

False

28 If one British pound can be exchanged for US $2.06 currently, how much currency would a British citizen need to purchase a dinner in New York that cost US $78.95?

a. 162.64 pounds

b. 78.95 pounds

c. 38.33 pounds

d. 2.06 pounds

29 One form of trade protection that restricts the amount of imports of a particular good is called a(n):

a. tariff.

b. quota.

c. restriction.

d. import.

Explanation / Answer

Answer 21. FALSE.

Why would a non-profit firm be illegal?

Non-profits like NGOs,etc do work freely in US.

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