An emission charge decreases private marginal cost and encourages greater output.
Answer the following statement true (T) or false (F)
False
An emission charge in proportion to pollution will increase the costs to the firm, shifting the MC curve upward (supply curve leftward) and the ATC up, resulting in lower output, higher prices, and lower profits.
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The above figure shows the market for 2 bedroom town homes in San Diego. If a rent ceiling is set at $1,000 per month, what is true?
A) The quantity of town homes demanded decreases to 100,000. B) Black market rents might be as high as $1,300 per month. C) The quantity of town homes supplied increases to 250,000. D) More town homes are rented after the rent ceiling that before. E) The quantity demanded of town homes is less than the quantity supplied.
The larger the number of bidders in an open outcry Dutch auction, ________
A) the lower is the maximum willingness to pay of each bidder B) the smaller is the consumer surplus earned by the winner C) the larger is the quantity offered by the auctioneer for auction D) the lower is the value of the starting bid
Two goods are considered substitutes when the cross elasticity of demand is ___ and complements when the cross elasticity of demand is ___
a. Greater than zero, less than zero. b. Less than zero, greater than zero. c. Greater than one, less than one. d. Less than one, greater than one.
Suppose, for whatever reason, the trade deficit of the United States with Europe is projected to grow and that before this happens the exchange rate between the euro and the dollar is .75 euros/dollar. The resulting exchange rate would likely
A. cause the exchange rate to have to be expressed in dollars per euro (because the other way would no longer make sense). B. rise to (perhaps) .9 euros/dollar. C. fall to (perhaps) .6 euros/dollar. D. remain unchanged.