1. Which of the following is true for a market with no externalities under perfect competition?
a. Market equilibrium gives the highest possible consumer surplus.
b. Market equilibrium gives the highest possible producer surplus.
c. Market equilibrium gives the highest possible total surplus.
d. Market equilibrium gives the highest possible unit price.
e. Market equilibrium gives the highest possible total revenue.
2. Which of these is a property of public goods?
a. Only governments may produce public goods.
b. Producers of public goods have zero fixed costs.
c. Public goods always have negative production externalities.
d. Those who do not purchase public goods cannot be excluded from consuming them.