Recall the Application about how the price of CO2 permits in the European Union is determined to answer the following question(s).Recall the Application. Which of the following factors has caused the increase in the price of CO2 allowances in the EU in 2017?
A. Member states agree on reforms that will increase the supply of allowances.
B. Member states agree on abolishing the Emissions Trading System (ETS).
C. The United States decides to increase its supply of allowances.
D. Member states agree on reforms that will decrease the supply of allowances.
Answer: D
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A study of the effects of the minimum wage on employment of low-skilled workers estimated the price elasticity of demand for low-skilled workers is -0.75
Suppose that the government is considering raising the minimum wage from $7.25 per hour to $7.75 per hour. Based on this information, calculate the percentage change in the employment of low skilled workers. Use the midpoint formula.
A perfectly competitive firm cannot practice price discrimination because
A) each consumer in a perfectly competitive market has the same willingness to pay. B) the firm can only charge the market price. C) a firm that breaks even in the long run cannot afford to engage in yield management. D) it does not advertise; this prevents the firm from marketing its product to different segments of the market.
When people invest at home, it is called ________, and when they invest abroad it is called ________.
A. I; NX B. S; I C. S; NCO D. I; NCO
Oligopoly is more difficult to analyze than other market models because:
A. the number of firms is so large that market behavior cannot be accurately predicted. B. the marginal cost and marginal revenue curves of an oligopolist play no part in the determination of equilibrium price and quantity. C. of mutual interdependence and the fact that oligopoly outcomes are less certain than in other market models. D. unlike the firms of other market models, it cannot be assumed that oligopolists are profit maximizers.