Figure 4.4 illustrates the supply of tacos. A technological advancement which makes tacos cheaper to produce would most likely cause a movement from:
A. point a to point c.
B. point c to point a.
C. S2 to S0.
D. S0 to S2.
Answer: D
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A security with a high degree of marketability sells at a price that is
A) highly volatile. B) unpredictable. C) lower than other securities. D) higher than the equilibrium price of less marketable securities.
The argument that government action is justified based on the fact that people would agree to be coerced to do the action if everyone else is forced to do the action is essentially an argument based _____
a. upon the transitional gains trap b. on the free rider problem c. on the ideal of the public interest d. prisoners dilemma
Externalities can be positive or negative. An example of a positive externality is the third-party benefits from solar energy production such as reduced emissions, cleaner air, and the "warm glow" some people experience from engaging in sustainable activities. An example of a negative externality is the emissions produced from driving gasoline powered motor vehicles such. These emissions have been shown to adversely effect the environment, agriculture, and human productivity, morbidity, and mortality. Which of the following policies would NOT incentivize consumers or producers to internalize external costs of the activities they engage in?
a. Driving subsidies to automobile drivers. b. Production subsidies to manufacturers of solar energy equipment such as photovoltaic cells and batteries. c. Driving taxes to automobile drivers. d. Consumption subsidies to buyers of solar energy equipment such as photovoltaic cells and batteries. e. None of the above.
A college student is thinking about running an ice-cream truck over the summer. Which of the following would likely be an ongoing expense of the business?
A. The cost of the gasoline used B. The cost of ice cream scoopers C. The cost of the truck D. None of these is an ongoing expense.