A completely successful emission fee:
A.) Results in zero pollution.
B.) Shifts the private MC curve to the same position as the social MC curve.
C.) Shifts the social MC curve to the same position as the private MC curve.
D.) Does not affect the private or social MC curve.
B.) Shifts the private MC curve to the same position as the social MC curve.
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What is the difference between a production possibilities curve and a consumption possibilities curve?
What will be an ideal response?
If the Fed reduces the money supply, banks will often initially have
a. more reserves than they are required to hold b. excess reserves c. increased demand deposits d. fewer loans than normal e. deficient reserves
Which of the following is NOT an assumption of the behavior of exchange rates in the short run?
a. The adjustment period of time involves weeks rather than years. b. Market forces are irrelevant and "do not matter." c. Prices of goods adjust slowly and are therefore "sticky." d. Economic actors behave in their own self-interest.
A market system tends to restrict business risk to owners and investors. This results in which of the following benefits?
A. It encourages more people to become entrepreneurs. B. Firms have to pay more to attract inputs, as these inputs have to share the risk. C. Firms focus attention on prudent risk management, as it is profitable to manage risk. D. Income becomes more equally distributed.