Externalities between two firms can be “internalized” if: I. The t – McqOptions

MCQOPTIONS

1.	Externalities between two firms can be “internalized” if: I. The two firms merge. II. Bargaining costs are zero.III. The externalities affect each firm equally. IV. Marginal costs for both firms are constant. Which statement(s) correctly complete(s) the sentence?
A.	only ii.
B.	all except iii.
C.	i and ii, but not iii and iv.
D.	i and iv, but not ii and iii.
Answer» D. i and iv, but not ii and iii.

Discussion

No Comment Found

Related MCQs

The quantity of present goods that must be forgone to increase future consumption by 1 unit iscalled
The risk premium for a capital investment by comparing the expected return on thatinvestment with the expected return on the entire stock market is measured by
An important mechanism through which sellers and buyers deal with the problem ofasymmetric information is
The concept of market signalling was first developed by
A scientific paper titled “The Tragedy of the Commons” was written by
Points where the slopes of the isoquants are equal
The marginal conditions must be satisfied for the attainment of a Pareto-efficient situation inan economy :
The sum of forgone interest and depreciation costs the machine’s owner must pay is the
Who argued that welfare is improved when ‘the greatest good (is secured) for the greatestnumber’
Several combination of commodities x and y that the economy can produce by fully utilizingall of the fixed amounts of labour and capital with the best technology available is depicted by I. production possibility frontier II. transformation curve III. production possibility curve