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Solutions for Chapter Module 76: Public Goods

Full solutions for Krugman's Economics for AP® (High School) | 2nd Edition

ISBN: 9781464122187

Solutions for Chapter Module 76: Public Goods

This textbook survival guide was created for the textbook: Krugman's Economics for AP® (High School), edition: 2. Since 5 problems in chapter Module 76: Public Goods have been answered, more than 10886 students have viewed full step-by-step solutions from this chapter. This expansive textbook survival guide covers the following chapters and their solutions. Krugman's Economics for AP® (High School) was written by and is associated to the ISBN: 9781464122187. Chapter Module 76: Public Goods includes 5 full step-by-step solutions.

Key Business Terms and definitions covered in this textbook
  • agent

    a person who is performing an act for another person, called the principal

  • average variable cost

    variable cost divided by the quantity of output

  • benefits principle

    the idea that people should pay taxes based on the benefits they receive from government services

  • Condorcet paradox

    the failure of majority rule to produce transitive preferences for society

  • corrective tax

    a tax designed to induce private decision makers to take account of the social costs that arise from a negative externality

  • corrective tax

    a tax designed to induce private decision makers to take account of the social costs that arise from a negative externality

  • efficiency wages

    above-equilibrium wages paid by firms to increase worker productivity

  • explicit costs

    input costs that require an outlay of money by the firm

  • financial markets

    financial institutions through which savers can directly provide funds to borrowers

  • fiscal policy

    the setting of the level of government spending and taxation by government policymakers

  • median voter theorem

    a mathematical result showing that if voters are choosing a point along a line and each voter wants the point closest to his most preferred point, then majority rule will pick the most preferred point of the median voter

  • monopoly

    a firm that is the sole seller of a product without close substitutes

  • natural monopoly

    a monopoly that arises because a single firm can supply a good or service to an entire market at a smaller cost than could two or more firms

  • opportunity cost

    whatever must be given up to obtain some item

  • positive statements

    claims that attempt to describe the world as it is

  • public goods

    goods that are neither excludable nor rival in consumption

  • reserve requirements

    regulations on the minimum amount of reserves that banks must hold against deposits

  • substitutes

    two goods for which an increase in the price of one leads to an increase in the demand for the other

  • surplus

    a situation in which quantity supplied is greater than quantity demanded

  • theory of liquidity preference

    Keynes’s theory that the interest rate adjusts to bring money supply and money demand into balance

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