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Foundations of Microeconomics, 6e (Bade/Parkin)
Chapter 10 Externalities

10.1 Negative Externalities: Pollution

1) Externalities
A) can be either benefits or costs.
B) always create extra social costs.
C) always make society better off.
D) cannot be expressed in dollar amounts.
E) are always part of private costs or private benefits.
Answer: A
Topic: Externalities
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 10.1, 5e
AACSB: Reflective thinking

2) A cost that arises from the production or consumption that falls on someone other than the
producer or consumer is called
A) a negative benefit.
B) a public choice impact.
C) a positive externality.
D) a negative externality.
E) a private good.
Answer: D
Topic: Externalities
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 10.1, 5e
AACSB: Reflective thinking

3) Evidence of external costs in the production of a product is present if


A) the price of the product is higher than it should be.
B) the production cost increases because of an increase in the minimum wage.
C) non-buyers and/or non-producers of the product experience a loss for which they are not
compensated.
D) buyers refuse to purchase the product.
E) producers pay all of the costs of producing the good or service.
Answer: C
Topic: Externalities
Skill: Level 4: Applying models
Section: Checkpoint 10.1
Status: Checkpoint 10.1, 5e
AACSB: Reflective thinking

1
Copyright © 2013 Pearson Education, Inc.
4) An example of someone bearing the burden of a negative production externality would be
A) Taylor living downwind from a smelly feedlot where pigs are raised.
B) Jess's roommate smokes and she doesn't.
C) Lynna's neighbors play loud music late at night.
D) All of these are examples of someone bearing the burden of a negative production externality.
E) None of these is an examples of someone bearing the burden of a negative production
externality.
Answer: A
Topic: Externalities
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 10.1, 5e
AACSB: Reflective thinking

5) An example of someone bearing the burden of a negative consumption externality would be


A) Taylor living downwind from a feedlot.
B) LaShawn grows beautiful roses in her garden.
C) Jess's roommate smokes and she doesn't.
D) All of these are examples of someone bearing the burden of a negative consumption
externality.
E) None of these is an example of someone bearing the burden of a negative consumption
externality.
Answer: C
Topic: Externalities
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 10.1, 5e
AACSB: Reflective thinking

6) To ensure all students are protected from getting the flu this year, your school offers free flu
shots. What type of externality exists in this example?
A) Negative consumption externality.
B) Positive consumption externality.
C) Positive production externality.
D) Negative production externality.
E) Neutral externality.
Answer: B
Topic: Externalities
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 10.1, 5e
AACSB: Reflective thinking

2
Copyright © 2013 Pearson Education, Inc.
7) A example of a good with external benefits is
A) a pizza.
B) a dose of flu vaccine.
C) a sewing machine.
D) an imported good.
E) a pair of running shoes.
Answer: B
Topic: Externalities
Skill: Level 2: Using definitions
Section: Checkpoint 10.3
Status: Checkpoint 10.3, 5e
AACSB: Reflective thinking

8) Which of the following is NOT an example of a good with an external cost?


A) electricity generation that produces carbon dioxide emissions that contribute toward global
warming
B) logging that pollutes a nearby river
C) Jess smoking near her non-smoking roommate
D) Ahmed working at a bank and he gets a flu shot each fall
E) noise pollution from aircraft
Answer: D
Topic: Externalities
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 10.1, 5e
AACSB: Reflective thinking

9) Pollution is an example of a ________ externality.


A) negative production
B) positive production
C) negative consumption
D) positive consumption
E) Coasian
Answer: A
Topic: Externalities
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

3
Copyright © 2013 Pearson Education, Inc.
10) When studying pollution and the environment, economists
A) have no role to play.
B) concentrate on the physical aspects of the environment.
C) emphasize costs and benefits.
D) attempt to reduce pollution at all costs.
E) think pollution is good if it occurs when production takes place.
Answer: C
Topic: Economics and pollution
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

11) The production of electricity creates pollution. When deciding how much electricity to buy,
customers ________ the cost of pollution. When deciding how much electricity to buy,
producers ________ the cost of pollution.
A) take into account; take into account
B) do not take into account; do not take into account
C) take into account; do not take into account
D) do not take into account; take into account
E) None of the above answers is correct.
Answer: B
Topic: Externalities
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

12) Marginal private cost


A) is always zero if there is an external cost.
B) equals the marginal social cost only if the marginal external cost is positive.
C) is the cost of producing an additional unit of a good or service that is paid by the producer of
that good or service.
D) the cost of producing an additional unit of a good or service that falls on people other than the
producer of that good or service.
E) the cost of producing an additional unit of a good or service that is paid by the entire society.
Answer: C
Topic: Marginal cost
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

4
Copyright © 2013 Pearson Education, Inc.
13) A private cost is a cost of production that is
A) borne by the producer of a good.
B) measured in marginal terms.
C) borne by someone other than the producer of a good.
D) measured in total terms.
E) the same as an external cost.
Answer: A
Topic: Private cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

14) The cost of producing an additional unit of a good or service that is borne by the producer of
that good or service is the marginal
A) external cost.
B) private cost.
C) social cost.
D) public cost.
E) None of the above answers is correct.
Answer: B
Topic: Private cost
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

15) The difference between private cost and social cost is that
A) social cost only considers the external cost borne by society.
B) social cost only considers the cost borne by people other than the producer.
C) private cost only considers the cost borne by producers of the good.
D) social cost also includes any external benefit whereas private cost excludes all external
benefits.
E) there is no difference; the terms refer to the same cost.
Answer: C
Topic: Private cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

5
Copyright © 2013 Pearson Education, Inc.
16) Harry, the owner of a beauty salon, hires a new hair stylist. The wages paid to the new stylist
are
A) a private cost and not an external cost .
B) an external cost and not a private cost.
C) both a private cost and an external cost.
D) neither a private cost nor an external cost.
E) only a private benefit because people want their hair styled.
Answer: A
Topic: Private cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

17) Joanne rents a TV production studio to produce an extra hour of a TV show. The rent is
A) a private cost and not an external cost.
B) an external cost and not a private cost.
C) both a private cost and an external cost.
D) neither a private cost nor an external cost.
E) a private benefit because viewers will benefit from watching the extra hour of the show.
Answer: A
Topic: Private cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

18) For a product with an external cost, the supply curve


A) represents the various quantities people can buy.
B) is the same as the marginal private cost curve.
C) is the same as the marginal social cost curve.
D) is the same as the marginal external cost curve.
E) is undefined.
Answer: B
Topic: Private cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

6
Copyright © 2013 Pearson Education, Inc.
19) For a firm, its labor costs are
A) a marginal benefit.
B) a private cost.
C) an external cost.
D) Both answers A and C are correct.
E) Both answers A and B are correct.
Answer: B
Topic: Private cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

20) The cost of producing an additional unit of a good or service that falls on people other than
the producer is the marginal
A) external cost.
B) private cost.
C) social cost.
D) social benefit.
E) None of the above answers is correct.
Answer: A
Topic: External cost
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

21) A marginal external cost of a product is equal to


A) what the producer has to pay to hire resources to produce another unit.
B) the cost someone other than the producer incurs when another unit is produced.
C) the cost the producer incurs to produce another unit.
D) what the consumer must pay when he or she buys the good or service.
E) None of these answers describes a marginal external cost.
Answer: B
Topic: External cost
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

7
Copyright © 2013 Pearson Education, Inc.
22) A loud band plays a concert late at night in a neighborhood park. The noise produced by the
band that keeps the neighbors not attending the concert awake is
A) only a private cost.
B) only an external cost.
C) both a private cost and an external cost.
D) neither a private cost nor an external cost.
E) a private benefit because the neighbors get to hear the band.
Answer: B
Topic: External cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

23) Which of the following is an example of an external cost?


A) taxes
B) the price of a car wash
C) pollution
D) an electricity bill
E) paying a wage that exceeds the minimum wage
Answer: C
Topic: External cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

24) A firm dumps dioxin in a river, thereby severely polluting the river. The cost of the water
pollution is
i. zero for the firm.
ii. an external cost.
iii. part of the marginal social cost
A) i only
B) ii only
C) iii only
D) ii and iii
E) i, ii, and iii
Answer: E
Topic: External cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

8
Copyright © 2013 Pearson Education, Inc.
25) When logging in the Pacific Northwest destroys forests that hikers would have used for eco-
tourism, the destruction of the trails is an example of
A) an external cost.
B) a private cost.
C) a government cost.
D) an external benefit.
E) None of the above answers is correct.
Answer: A
Topic: External cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

26) Which of the following is an example of an external cost?


A) a grove of trees planted in a park in Seattle
B) a library built in Philadelphia
C) a new, faster computer chip
D) an oil spill off the coast of South America
E) a student graduating from college
Answer: D
Topic: External cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

27) Jacob pays $5,000 to paint his house because pollution from a nearby factory damaged the
paint. To the factory, the $5,000 cost is
A) a private cost and not an external cost.
B) an external cost and not a private cost.
C) both a private cost and an external cost.
D) neither a private cost nor an external cost.
E) a private benefit because viewers will benefit from watching the extra hour of the show.
Answer: A
Topic: External cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

9
Copyright © 2013 Pearson Education, Inc.
28) A landfill site produces an obnoxious odor. Homes downwind of the site rent for $1000 per
month while homes upwind of the site rent for $1500 per month. If the odor is the only
detectable difference between two neighborhoods, the difference in the rent is the ________ of
the odor.
A) social cost
B) external cost
C) private cost
D) marginal cost-benefit
E) private benefit
Answer: B
Topic: External cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

29) Suppose two neighborhoods (A and B) have identical housing, but neighborhood A has a
strictly enforced deed restriction that prohibits homeowners from parking junk cars in the front
yard. If houses in neighborhood A sell for $105,000 and houses in neighborhood B sell for
$100,000, how would an economist value the external cost of visible junk cars, per house?
A) $205,000
B) $105,000
C) $100,000
D) $5,000
E) None of the above answers is correct.
Answer: D
Topic: External cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

30) Suppose two neighborhoods with 10 homes each in Buffalo, New York are identical except
one of them is near a toxic waste dump. If homes near the dump sell for an average of $40,000
and the other homes sell for $90,000, the external cost of the dump is
A) $400,000.
B) $1,300,000.
C) $900,000.
D) $500,000.
E) $90,000.
Answer: D
Topic: External cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

10
Copyright © 2013 Pearson Education, Inc.
31) The marginal cost incurred by the entire society to produce a good or service is the
A) marginal external cost.
B) marginal private cost.
C) marginal social cost.
D) marginal social benefit.
E) marginal private benefit.
Answer: C
Topic: Marginal social cost
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

32) Marginal social cost is equal to


A) the amount people who buy a product pay for another unit.
B) whatever producers have to pay to produce output.
C) the sum of marginal private cost and the marginal external cost.
D) the average of marginal private cost and the marginal external cost.
E) None of the above answers is correct.
Answer: C
Topic: Marginal social cost
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

33) Marginal social cost is the


A) price a consumer pays for one more unit of a good.
B) cost a producer incurs producing one more unit of a good.
C) cost of producing one more unit of a good that falls on someone other than the producer.
D) sum of the cost a producer incurs from producing one more unit of a good plus the cost of
producing one more unit of a good that falls on someone other than the producer.
E) same as marginal cost only if there is an external cost when the good is produced.
Answer: D
Topic: Marginal social cost
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

11
Copyright © 2013 Pearson Education, Inc.
34) Which of the following equations is correct?
A) MC = MSC + marginal external cost
B) MSC = MC ÷ marginal external cost
C) MSC = MC + marginal external cost
D) MSC = MC × marginal external cost
E) MC = marginal external cost - MSC
Answer: C
Topic: Marginal social cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

35) The marginal social cost of producing a good or service is the


A) cost of producing an additional unit borne by the producer.
B) cost of producing an additional unit borne by people other than the producer.
C) sum of the marginal private cost and the marginal external cost.
D) same as marginal external cost.
E) sum of the marginal private cost and the marginal external cost minus the marginal social
benefit.
Answer: C
Topic: Marginal social cost
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

36) Which of the following is true?


A) MSC = MC + Marginal external cost.
B) MC = Marginal external cost - MSC.
C) MC = Marginal external benefit + MSC.
D) MSC = Marginal external cost + marginal external benefit.
E) MSC = Marginal external cost - marginal external benefit.
Answer: A
Topic: Marginal social cost
Skill: Level 1: Definition
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

12
Copyright © 2013 Pearson Education, Inc.
37) If there is no external cost, then marginal social cost
A) increases as output increases.
B) decreases as output increases.
C) is constant regardless of the level of output.
D) is unrelated to output levels.
E) first increases and then decreases as output increases.
Answer: A
Topic: Marginal social cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

38) If a product has zero external costs, then


A) marginal social cost equals marginal private cost.
B) marginal social cost is greater than marginal private cost.
C) marginal social cost is less than marginal private cost.
D) marginal social cost equals zero.
E) We need more information to determine the relationship between marginal private cost and
marginal social cost.
Answer: A
Topic: Marginal social cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

39) If the marginal external cost of building a children's playground equals zero, then the
i. marginal private cost equals the marginal social cost.
ii. marginal social cost equals zero.
iii. marginal private cost equals zero.
A) i only
B) ii only
C) iii only
D) ii and iii
E) i and ii
Answer: A
Topic: Marginal social cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

13
Copyright © 2013 Pearson Education, Inc.
40) If the marginal private cost of running a car is $0.30 a mile and the marginal external cost is
$0.10, what is the marginal social cost?
A) $0.20
B) $3.00
C) $0.03
D) $0.40
E) None of the above answers is correct.
Answer: D
Topic: Marginal external cost
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

41) If the marginal social cost of generating a kilowatt of electricity is $0.10 and the marginal
private cost is $0.08, what is the marginal external cost?
A) $0.18
B) $0.10
C) $0.08
D) $0.02
E) $0.80
Answer: D
Topic: Marginal external cost
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

42) If the marginal social cost of producing a ton of cement is $4,000 and the marginal private
cost is $3,500, then the
A) marginal benefit of a ton of cement will equal $4,000.
B) total cost of producing a ton of cement is $7,500.
C) marginal external cost of producing a ton of cement is $500.
D) marginal external cost of producing a ton of cement is $7,500.
E) marginal external cost of producing a ton of cement is $4,000.
Answer: C
Topic: Marginal social cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

14
Copyright © 2013 Pearson Education, Inc.
43) If a good has an external cost, then the marginal private cost curve
A) lies below then the marginal social cost curve.
B) lies above the marginal social cost curve.
C) lies below the horizontal axis.
D) is the same as the marginal external cost curve.
E) is undefined because the firms' costs are not equal to the social costs.
Answer: A
Topic: Marginal social cost
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

44) The marginal external cost and marginal private cost


A) are all borne by the seller.
B) are opportunity costs.
C) when added, equal the sum of the marginal private benefit plus the marginal social benefit at
equilibrium.
D) are regulated by the government.
E) must always be equal in equilibrium.
Answer: B
Topic: Marginal social cost
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

45) If the production of a good causes an external cost, then the efficient quantity is
A) equal to the quantity at which the marginal benefit equals marginal cost.
B) less than the quantity at which the marginal benefit equals the marginal cost.
C) more than the quantity at which the marginal benefit equals the marginal cost.
D) the quantity at which the marginal private benefit is greater than the marginal social benefit.
E) None of the above answers is correct.
Answer: B
Topic: Efficiency
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

15
Copyright © 2013 Pearson Education, Inc.
46) If a good has an external cost, the
A) unregulated competitive market outcome is efficient.
B) marginal private cost reflects the external cost.
C) unregulated competitive market outcome is inefficient.
D) marginal social benefit is equal to the marginal social cost when the market is in equilibrium.
E) external benefit must equal the external cost.
Answer: C
Topic: Inefficient equilibrium
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

47) The basic reason that a competitive unregulated market produces an inefficient amount of a
good with an external cost because
A) producers cannot measure marginal social cost.
B) producers do not pay the external cost.
C) the general public does not care about external costs.
D) external costs are not a political issue.
E) the external cost is paid by consumers rather than producers.
Answer: B
Topic: Inefficient equilibrium
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

48) When production of a good results in an external cost, the unregulated competitive market
equilibrium quantity is
A) the efficient level of output.
B) greater than the efficient level of output.
C) not zero but is less than the efficient level of output.
D) unattainable.
E) zero.
Answer: B
Topic: Inefficient equilibrium
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

16
Copyright © 2013 Pearson Education, Inc.
49) If producing a good or a service creates pollution, then
A) an unregulated competitive market produces an efficient output.
B) the industry's supply curve includes the extra cost of pollution.
C) at the unregulated, competitive market equilibrium quantity, marginal social cost is greater
than the equilibrium price.
D) at the unregulated, competitive market equilibrium quantity, marginal social benefit and
marginal social cost are equal.
E) at the unregulated, competitive market equilibrium quantity, marginal social benefit is less
than the equilibrium price.
Answer: C
Topic: Inefficient equilibrium
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

50) An external cost in the production of a good creates a difference between the
i. costs borne by the producer and the costs borne by society in general.
ii. efficient quantity of output and the equilibrium quantity of output.
iii. marginal social cost and the marginal private cost.
A) i only
B) iii only
C) ii and iii
D) i, ii, and iii
E) i and iii
Answer: D
Topic: Inefficient equilibrium
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

51) The deadweight loss associated with producing a product that has an external cost occurs
because
A) too much output is produced.
B) too little output is produced.
C) the price firms charge for the good is too high.
D) not enough resources are allocated to producing the good.
E) the marginal social cost does not equal zero.
Answer: A
Topic: Inefficient equilibrium
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Reflective thinking

17
Copyright © 2013 Pearson Education, Inc.
52) When production of a good results in an external cost, the unregulated competitive market
equilibrium is inefficient because ________.
A) MSC = MC
B) MSC = MB
C) MSC > MB
D) MSC < MB
E) MSC is undefined
Answer: C
Topic: Inefficient equilibrium
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

53) For a good whose production creates an external cost, the efficient quantity of output is
A) where the market demand curve and the market supply curve intersect.
B) where the marginal social cost curve and marginal benefit curve intersect.
C) as low as possible.
D) zero.
E) the amount of production so that the marginal social benefit exceeds the marginal social cost
by as much as possible.
Answer: B
Topic: Efficiency
Skill: Level 2: Using definitions
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

18
Copyright © 2013 Pearson Education, Inc.
54) The figure above illustrates the marginal private cost and the marginal social cost to the city
of Seattle for each rock concert that is offered. If 5 concerts are put on, then the
A) marginal external cost will be greater than the marginal social cost.
B) marginal external cost will be greater than the marginal private cost.
C) marginal external cost will equal the marginal private cost.
D) marginal social cost will equal the marginal external cost.
E) marginal external cost will equal zero.
Answer: B
Topic: External cost
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

55) The figure above illustrates the marginal private cost and the marginal social cost to the city
of Seattle for each rock concert that is offered. Suppose the marginal private cost of the 5th
concert is $10,000. Then, for the 5th concert, the
A) marginal external cost equals $30,000.
B) marginal social cost equals $30,000.
C) marginal external cost equals the marginal private cost.
D) marginal external cost equals $40,000.
E) marginal external cost equals $10,000.
Answer: A
Topic: External cost
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

19
Copyright © 2013 Pearson Education, Inc.
56) The figure above illustrates the marginal private cost and the marginal social cost to the city
of Seattle for each rock concert that is offered. At 10 concerts, the
A) marginal private cost equals the marginal external cost.
B) marginal social cost equals $60,000.
C) marginal private cost is more than $40,000.
D) marginal external cost equals $60,000.
E) marginal external cost equals $80,000.
Answer: D
Topic: External cost
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

57) The figure above represents the relationship between output and cost in an industry with an
external cost. Which line represents the marginal private cost (MC) curve?
A) Curve 1
B) Curve 2
C) the dotted line BC
D) the y-axis
E) the dotted line AB
Answer: B
Topic: Private cost
Skill: Level 3: Using models
Section: Checkpoint 10.1
Status: Checkpoint 11.1, 5e
AACSB: Analytical reasoning

20
Copyright © 2013 Pearson Education, Inc.
Another random document with
no related content on Scribd:
+ Review 2:522 My 15 ’20 200w

“Lady Ritchie interests and amuses us without falling either into


the distortions of malice, or the sentimentally which dwells on the
‘dear old days,’ and leaves us as cold as if we were listening to a
canting preacher.”

+ Sat R 129:189 F 21 ’20 750w

“Charming little book.”

+ Spec 124:54 Ja 10 ’20 140w


Springf’d Republican p8 My 1 ’20 120w

“Lady Ritchie knew what was interesting and what was not; she
lived intensely in her memories, and she can take her readers to live
in them with her.”

+ The Times [London] Lit Sup p19 Ja 8


’20 1100w

RITCHIE, ROBERT WELLES. Trails to Two


Moons. il *$1.75 (3½c) Little

20–17007

The story is of the Wyoming cattle country at the time when the
struggle for existence was on between the cattle rangers and the
sheep-raising homesteaders. Little by little the latter were
encroaching upon the former’s grazing lands. Three figures stand out
in the tale, Zang Whistler, the cattle-thieving outlaw, Original Bill
Blunt, inspector for the Stockman’s alliance, and Hilma Ring, a
sheepherder’s daughter, a dazzling but heartless beauty. A lonely life
of hardship and struggle had cut her off from all femininity and
hardened her heart. It is the taming of this shrew that tempts both
Zang and Original. Amid killings and rough horse-play, during which
Hilma has her fill of terror, loneliness and despair, nursing her
hatred for Original, the latter’s character and power finally subdue
and awaken the woman in her. Even Zang, whose wild career is but
an offshoot of his inherent integrity, receives Hilma’s recognition of
his loyalty and devotion.

“The story possesses a sort of crude strength besides exciting


incidents; its characters are fairly well individualized; its descriptions
are vivid, and its fights colorful. However, we cannot say that the
conversion of the heroine’s hate for the hero to love for him is
convincing. The strings that pull the character hither and thither at
this point of the story are altogether too evident.”

+ − N Y Evening Post p21 O 23 ’20 110w

“The story is ultra-romantic and the characters not essentially of


flesh and blood—mere types and caricatures. But the setting in which
the story occurs is painted so very vividly that it lends the air of
reality to ‘Trails to Two Moons’ which the characters themselves and
their vigorous actions lack.”

+ − N Y Times p25 D 26 ’20 320w


ROBBINS, CLARENCE AARON (TOD
ROBBINS). Silent, white and beautiful; and other
stories. *$1.90 (3c) Boni & Liveright

Short stories by an author who makes a specialty of the gruesome.


Contents: Silent, white and beautiful; Who wants a green bottle?
Wild Wullie, the waster; For art’s sake. There is a preface by Robert
H. Davis.

“If these grotesque and morbid tales were just a bit better, they
might even be great! But failing of greatness, they are so horrible as
to be occasionally funny.”

− + Bookm 52:550 F ’21 100w

“The horror of the truth in daily life is greater than the horror Mr
Robbins seeks in his imaginative and improbable wanderings among
murderers and spirits.” R. D. W.

− Boston Transcript p8 Ja 29 ’21 350w

“Genuine horror requires a certain inner logic, a subtle plausibility


not discoverable in these stories.” L. B.

− Freeman 2:358 D 22 ’20 170w

“There is no doubt that he has an eerie fancy, great fertility of


invention, and not a little psychological insight. But he is unequal to
the point of eccentricity. Two of his four narratives, ‘Wild Wullie, the
waster,’ and ‘Who wants a green bottle,’ are simply inept. ‘Silent,
white and beautiful,’ on the other hand, has an original and strangely
vivid central idea.”

+ − Nation 111:596 N 24 ’20 230w

“Frankly tales of terror, built upon most improbable foundations,


they would be revolting in the hands of a lesser artist.”

+ N Y Evening Post p17 D 4 ’20 100w

“The author has dipped his pen in blood while steeping his literary
ego in diablerie, and the outcome is a feast of melodrama and
morbidity that leads logically to nightmare.”

− + N Y Times p27 Ja 2 ’21 420w

ROBERTS, CECIL EDRIC MORNINGTON.


Poems. *$1.50 Stokes 821

20–1006

This collection of poems falls into three parts: Poems; The dark
years; and Other poems. John Masefield writes a preface to the
collection and says of the author: “When I think of the poems, I feel
that he must be young; not young enough perhaps to have been
carried away, or destroyed, by the recent great events, but young
enough to see them clearly, to respond to them, and to realize that
the tragedy of them has been the tragedy of the young, the blasting of
the young, for the benefit and at the bidding of the old.... That, in the
main, is the tragedy of Mr Roberts’ latest and best poems, in the
volume here printed.” In another place he says of the poet: “He has a
quick eye for characters, a lively sense of rhythm, and a fondness for
people, which should make his future work as remarkable as his
present promise.”

“Will be liked by those who enjoy conventional poetry touching on


a note of sadness.”

+ Booklist 16:235 Ap ’20

“These labored verses move us not at all. The book is full of echoes
and infelicitous imitations. The book, in short, is full of clichés of
thought and phrase.” H: A. Lappin

− Bookm 51:213 Ap ’20 100w


“The experience which has made Mr Roberts ‘old’
to his friends, has by a curious paradox kept him
gloriously young in his dreams and visions. These
poems, even embedding such grim interludes as is
represented by the ‘Charing cross’ poems, are the
poems of youth; but of a youth who has been trebly
stored with the ancient wisdom and ways of the
world.” W. S. B.

+ Boston Transcript p6 Ja 24 ’20 2150w

“Delightful poems chiefly on Arcadian themes.”

+ |Cleveland p52 My ’20 60w


Reviewed by Mark Van Doren

Nation 111:sup415 O 13 ’20 60w

“It is not enough to be high-spirited, and warm-hearted, and


quick-witted, and brave and sensitive—and this poet is all these. To
feel splendidly is one thing, to shape the feeling another. Mr Roberts
at present is apt to throw off his feeling into rhyme without due
concentration, as though assuring us of his exuberance and bidding
us be content with that.” J: Drinkwater

+ − N Y Times 25:240 My 9 ’20 380w

“The many lyric poems are a flower-garden in which the reader can
spend a long time, and to which he will want to return. Mr Roberts
writes gracefully and melodiously, and is never elaborate or
artificial.”

+ Springf’d Republican p8a Ap 4 ’20 700w

ROBERTS, RICHARD. Unfinished program of


democracy. *$2 Huebsch 321.8

(Eng ed 20–6572)

“‘The unfinished programme of democracy.’ by Dr Richard


Roberts, readily divides itself into two parts: the first three chapters
in which the author sets forth what he considers to be the causes of
the present crisis in democracy, and the rest of the book in which he
specifies in detail and supports with argument the measures and
changes that would, in his view, fulfil the democratic ideal.”
(Freeman). “The main lines of practical doctrine on which the
discussion is conducted are—a national minimum and a secure
standard of life universally enforced and provided for; the limitation
of profits; the elimination of the ‘social parasite’; the economic
independence of women; the abandonment of the dogma of ‘State
sovereignty’ and the recognition in the organization of government of
the geographical and the vocational unit; the growth of the spirit and
practice of social fellowship; a democratic world knit by a federation
of democratic nations.” (The Times [London] Lit Sup)

“Mr Roberts’s work is one to be read and inwardly digested.”

+ Ath p1048 O 17 ’19 130w


Booklist 17:142 Ja ’21
Brooklyn 12:125 My ’20 30w

“It is only the first part of the book, in which Dr Roberts states his
social theory, that in the view of the writer of this note exposes itself
to criticism.” T. M. Ave-Lallemant

+ − Freeman 1:428 Jl 14 ’20 1100w


Ind 103:319 S 11 ’20 30w

“The book is both refreshing and heartening and deserves a wide


reading, not only for the soundness of its ideas but for the distinction
and charm of its temper, and the vividness of its style.”

+ Nation 111:330 S 18 ’20 620w


“He writes with force and charm; and he gives evidence of wide
reading and of serious reflection. But when he comes to chapter VII,
‘The organization of government,’ his hand fails him.” W. J. Ghent

+ − Review 3:316 O 13 ’20 300w


+ Springf’d Republican p8 F 7 ’20 60w

“It is a scholarly book by a man of vision.” A. J. Lien

+ Survey 45:73 O 9 ’20 180w

“One of the ablest of the ministers of the English Presbyterian


church here discusses the social problem in a comprehensive and
practical way, with a full appreciation of new conditions and new
trends of thought.”

+ The Times [London] Lit Sup p550 O 9


’19 180w
Wis Lib Bul 16:107 Je ’20 60w

ROBEY, GEORGE. My rest cure. il *$1.40 (4c)


Stokes 827

19–13978

The author informs his readers that he is tired of being funny, that
he has had a collapse and needs a complete rest, and he is going to
tell about his holiday in the country in his natural serious and solemn
manner. By the skin of his teeth he succeeds in escaping from home
without his wife and the entire family. His haven of rest is the
Sunrise Arms of Little Slocum. The dream and the reality of Little
Slocum are not quite the same. He almost succumbs to the
ministrations of the sewing-bee of Little Slocum mothers, but after a
ten mile flight in pajamas and mackintosh and rubber boots he
catches a train that takes him back to the city. The illustrations by
John Hassall add to the solemnity of the book.

+ Booklist 16:246 Ap ’20

“It may be that Mr Robey converses too much about nothing in


particular, it may be that his humor is not that of America; but
various episodes in his book are excruciatingly funny.”

+ Boston Transcript Mr 13 ’20 350w

“We cannot say that we have been vastly exhilarated by ‘My rest
cure.’”

− Sat R 128:160 Ag 16 ’19 340w

ROBINSON, ALBERT GARDNER. Old New


England houses. il *$5 Scribner 728

20–16280
“‘Old New England houses’ has about one hundred sumptuously
printed views, mostly of the type of plain, unpretentious small
country houses of the seventeenth and eighteenth centuries, which
we roughly classify as ‘colonial,’ though quite a few of the more
pretentious mansion type of house, such as were built by the
wealthier merchants and shipmasters in the larger coast towns, are
included. The subjects are selected from an artistic rather than an
architectural or antiquarian viewpoint. The first few pages are given
to an untechnical talk on the varied types and styles of houses and
where one may hunt for them with reasonable chance of success, but
the greater part of the book is devoted to the pictures of the houses
themselves, an entire page being usually given to each print.”—
Boston Transcript

+ Boston Transcript p4 S 29 ’20 280w

“The text of this book is slight, not wholly unsuggestive perhaps,


but disappointing. The illustrations, however, are of positive
interest.”

+ − N Y Evening Post p14 O 23 ’20 520w

Reviewed by W. B. Chase

+ N Y Times p2 S 12 ’20 2450w


+ Outlook 126:202 S 29 ’20 70w

Reviewed by E. L. Pearson
+ Review 3:314 O 13 ’20 30w

“Like most books of the sort, ‘Old New England houses’ is more to
be valued for its pictures than for its text. Here the text, however, is
entirely adequate as a brief introduction to upward of a hundred
photographs.”

+ Review 3:479 N 17 ’20 180w

“‘Old New England houses’ will be interesting and useful.”

+ Springf’d Republican p9a O 3 ’20 260w

ROBINSON, EDWIN ARLINGTON. Lancelot.


*$1.75 Seltzer 811

20–12049

“In ‘Lancelot’ Mr Robinson has continued the study of Camelot


which he began three years ago in ‘Merlin.’” (Nation) “We open at the
period in the Arthurian triangle when Lancelot, who has seen the
grail, has determined to leave Camelot and Guinevere forever, and
follow the lonely marsh-light that the knights hailed as the true
gleam. Guinevere tempts him out of this. Arthur and his knights
return, and find what the purblind king has shut his eyes to so long.
Lancelot flees, and Guinevere is to be burnt at the stake. The greatest
of the knights returns and rescues her, taking her to his castle of
Joyous Gard; from which he later surrenders her. But the poison of
the situation has raised up enemies in the king’s own household,
especially his illegitimate son, Modred, and Lancelot, persuaded too
late to go to the king’s aid, arrives after the battle in the north, in
which king and bastard alike receive their death-wounds. He pays
one final visit to Guinevere, habited as a nun, but still enough of her
own self to listen to Lancelot’s belated plea that she rejoin him, and
now enough of her new self to refuse it. Then the passion-wrecked
knight rides away after that will-o-the-wisp whose presence men still
vainly seek without themselves.” (N Y Call)

+ Booklist 17:22 O ’20

“Any modern treatment of the Arthur material challenges


comparison at once with some of the illustrious names in English
literature: Tennyson, Swinburne, Arnold, and Morris, to mention
only the best known. Mr Robinson’s ‘Lancelot’ is no misbegotten
changeling in this notable company. The analysis is subtle,
unsentimental, and contagiously sympathetic.” R. M. Weaver

+ Bookm 51:457 Je ’20 520w

“In this narrative Mr Robinson not only proves by reason of


thought and substance his position as the greatest of all living
American poets, but also by the supreme consciousness and
evocation of beauty.” W. S. B.

+ Boston Transcript p9 Je 12 ’20 1350w


+ Cleveland p86 O ’20 80w

“The verse moves with dignity and attains at times even a


detachable beauty, and yet the memorable lines are comparatively
few—for this author.”

+ − Dial 69:103 Jl ’20 120w

“It has no pictorial exuberance. Scarcely a line could be quoted for


self-sufficient imagery. For the rest, the beauty of the poem is a low-
keyed, intense but quiet beauty of cadence and rhythm. Its matter
speaks with restraint and with completion. Its power lies in the
immanence of its people and their struggle with their fate.” C. M.
Rourke

+ Freeman 2:164 O 27 ’20 550w

“The verse of ‘Lancelot’ is as athletic and spare as an Indian


runner, though it walks not runs. At the same time, he varies his
verse in admirable accord with situation and character. Since
Browning there has been no finer dramatic dialogue in verse than
that spoken by Lancelot and Guinevere and no apter characterization
than the ironical talk of Gawaine. One must go out of verse, to
George Meredith and Henry James, to find its match. But Mr
Robinson has the advantage of verse.” C. V. D.

+ Nation 110:622 My 8 ’20 650w

“Edwin Arlington Robinson can say more in two lines than most
poets can in several verses. His vision is somber; it is marked by an
uncompromising consistency in the handling of eternal values.” H. S.
Gorman

+ New Repub 23:259 Jl 28 ’20 1150w


“‘Lancelot’ is life, albeit a gray and grim vision of it. It is a great
tale, greatly told. American poetry is richer for the aching
disillusionment of Mr Robinson’s art.” Clement Wood

+ N Y Call p11 My 16 ’20 750w

“It has been well thought out, well felt and well made. This is not
to say that it is a great poem, however, or that no important criticism
can be brought against it. When he draws personality the lines are
firm and flawless. But can he show us the color and texture of life,
and make us feel the heat of it in those old days of myth and magic?”
Marguerite Wilkinson

+ − N Y Times 25:170 Ap 11 ’20 1050w

“Its supreme beauty lies in its analysis of character and motive.”

+ Outlook 127:67 Ja 12 ’21 780w

“Mr Robinson’s ‘Lancelot’ is a finer achievement than his ‘Merlin.’


Splendidly imagined and unerringly wrought, this book reaffirms the
conviction that Mr Robinson is today the most significant figure in
American verse.” E: B. Reed

+ Yale R n s 10:205 O ’20 280w

ROBINSON, EDWIN ARLINGTON. Three


taverns. *$1.50 Macmillan 811

20–15484
“Edwin Arlington Robinson’s new volume of miscellaneous poems,
‘The three taverns’ is likely to earn him—if he has not already earned
—a reputation as the Henry James among poets. His fondness for
portraying the complex facets of character in an oblique light and by
means of inscrutable hints and sinuous innuendoes has led him to
further workings of the vein of dramatic lyric opened four years ago
by his famous ‘Ben Johnson entertains a man from Stratford.’ The
present collection contains seven long poems of this sort, revealing in
monolog or dialog a moment in the life of St Paul, Lazarus, Brown of
Harper’s ferry, Hamilton, and real or imagined people of lesser
note.”—Springf’d Republican

+ Booklist 17:106 D ’20

“‘The man against the sky’ indicated very clearly the place of the
poet, it was very high—how high we had not the standards by which
to measure. ‘The three taverns’ brings us much nearer to him, closer
within the embrace of his sympathies, and, by the same law, lifts him
much farther above us.” S: Roth

+ Bookm 52:361 D ’20 500w

“The substance of the longer poems in this book is more


profoundly grounded in Mr Robinson’s philosophy of human nature
and experience than in any of his other poems. Even in the shorter
poems we find this power distilled until almost achingly the
meanings break through a speech that is simplified to a bareness of
figure or illusion. Take the poem ‘The mill’ and say if a tragedy could
be so mercilessly told with the economy of speech by any other living
poet.” W. S. B.
+ Boston Transcript p9 S 11 ’20 1850w

“Here is a great virtue that belongs peculiarly to Mr Robinson


among American poets. His work is always packed with thought. ‘The
three taverns’ is a big book and it grows with each reading. It is the
work of lonely hours, of unfailing meditation, and of authentic
genius, if such a thing may be admitted to exist in these troublous
times.” H. S. Gorman

+ Freeman 2:186 N 3 ’20 1150w

“It is a sombre book, ‘The three taverns,’ sombre and polished to a


high dark sheen, and the bitter tang of it remains in the memory
after reading.” C. F. G.

+ Grinnell R 16:332 Ja ’21 340w

“Separate enough in themselves, they yet stand with respect to


each other in a sort of pattern, like the monoliths of a Druid circle....
What holds them in the pattern is that tone of mingled wisdom and
irony, that color of dignity touched with colloquial flexibility, that
clear, hard, tender blank verse and those unforgettable eight-line
stanzas and dramatic sonnets which go to make up one of the most
scrupulous and valuable of living poets.” C. V. D.

+ Nation 111:453 O 20 ’20 1300w

“‘The three taverns’ is a finished product. It is a book such as only


a master, touched with the authentic fire of genius, could make
possible. Within its 120 pages is crystallized the best of modern
American poetry. No European could find better introduction to
American achievement in letters than through the poems that are
contained in ‘Three taverns.’” H. S. Gorman

+ N Y Times p18 Ja 16 ’21 1250w

“Little of his old magic of intonation and rhythm is lacking from


‘The three taverns,’ even though the intellectual appeal overmasters
at times the poetic.”

+ Outlook 127:67 Ja 12 ’21 680w

“Mr Robinson’s verse, as always, flows with limpid purity, but his
quaintly compounded vocabulary and his intellectual penetration
compel the closest attention to his pages. Readers who have the
patience or the agility to follow Mr Robinson are not meanly
rewarded.”

+ − Springf’d Republican p10 O 7 ’20 450w

ROBINSON, EDWIN MEADE (TED


ROBINSON, pseud.). Piping and panning. *$1.75
Harcourt 811

20–16520

The author conducts a column in the Cleveland Plain Dealer and


this is a volume of his humorous newspaper verse. Among the titles
are: To a lady; The lecture; The story of Ug; Things I despise; Things
I like; Some Anglicisms; The drawbacks of humor; Love lyrics; We
Olympians; The critic’s apology; In various keys; The typewriter’s
song; Rural delights; Butter and eggs; The average man.

“Of its kind, Edwin Meade Robinson’s ‘Piping and panning’ is of a


pleasant quality. No man may trifle with the muse day after day with
impunity, but Mr Robinson has been able to command her support
in a fair average of instances. His book discloses a nimble fancy, a
facile dominion of vocabulary and verse forms, and a ready wit.” L. B.

+ − Freeman 2:190 N 3 ’20 160w

“Many of the verses, it is true, are occasional and uninspired; but


the book is a wholly satisfactory one for the good things it has in
abundance.” Clement Wood

+ − N Y Call p8 Ja 9 ’21 180w

ROBINSON, ELIOT HARLOW. Maid of


Mirabelle. il *$1.75 (2c) Page

20–12599

A story of the last days of the war and the period immediately
following. The scene is laid in a village of Lorraine. Here Daniel
Steele, an American Friend who has come to France to do relief and
reconstruction work, falls under the spell of Joan le Jeune, the maid
of Mirabelle. When Daniel had left home he had taken with him the
promise of his foster-sister Faith to be his wife on his return. But for
a little time Joan makes him forget Faith, and Joan, to whom he
brings the romance of strange lands, almost forgets her own soldier
lover Jean. But when Jean is under suspicion she turns to him, and
Daniel, too, recovering from a wound, finds his thoughts bound up in
Faith and is ready to return to his own country leaving Joan to her
happiness.

“Somewhat too sentimental in execution, but simple and pretty.”

+ − Outlook 126:67 S 8 ’20 20w

ROCHE, ARTHUR SOMERS. Uneasy street. il


*$1.75 (2c) Cosmopolitan bk. corporation

20–2645

He was an impecunious clerk before the war, but won a


commission and was swept into New York gilt-edged society by his
millionaire chum after their discharge. He goes the pace and one
night of it finds him in debt and in love and temptation staring him
in the face in the form of a trunkful of money under his hotel bed. He
falls for it, takes what he needs with intentions to refund, but is
found out before that happy event can take place. Then his manhood
reasserts itself, he returns the stolen money and makes a clean
confession of his guilt to his employer, his chum’s father. He is
forgiven and is reinstated in the good graces of his fiancée, his chum
and gilt-edged society.

“In construction the present story is by far the best he has written.”

+ Boston Transcript p4 Ap 7 ’20 120w


“That the story is devoid of all plausibility will not detract from its
interest to such readers as enjoy this sort of a book.”

+ − N Y Times 25:120 Mr 14 ’20 220w

Reviewed by Joseph Mosher

Pub W 97:177 Ja 17 ’20 260w

ROCHECHOUART, LOUIS VICTOR LÉON,


[2]
comte de. Memoirs of the Count de Rochechouart;
auth. tr. by Frances Jackson. *$5 Dutton

20–17881

“These memoirs are a first-class historical document of the period


before and after the Napoleonic wars. The Count de Rochechouart
was only a lad when the revolution broke out, and practically without
money he made his way across Europe and took service with the
Emperor of Russia, whom he served until 1814, when he was
appointed to a military post under the restored Bourbons in Paris,
and took a prominent part in the refounding of royalist France.”—Sat
R

“His narrative is of absorbing interest, in itself: material enough


for a dozen historical romances, told with vivacity, a wealth of
illuminative anecdote. The version is faithful and admirably written,
a valuable contribution to French and European history in our
language.”

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