If you buy a bond from a firm, you are making a loan to the firm.
Answer the following statement true (T) or false (F)
True
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A fall in the price of wheat fertilizer ________ the equilibrium price of wheat and ________ the equilibrium quantity of wheat
A) raise; increase B) raise; decrease C) lower; increase D) lower; decrease
The government prefers a market-based approach to reduce firms’ emissions of a toxic gas but wants to make certain that no more than 1,000 cubic yards of the gas are ever emitted in a single day. The most efficient policy under these circumstances is likely to be a system of
A. per-unit taxes on emissions of the gas. B. per-unit taxes on the goods produced by firms that emit the gas. C. subsidies to firms that agree not to emit the gas. D. sales of permits to emit specified quantities of the gas on specified days.
According to the text, one argument in favor of concentration of market power is that
A. Market power results in higher prices and lower quantities. B. Large firms can sometimes produce more efficiently than small firms because of economies of scale in production. C. The exercise of market power provides a more desirable mix of output. D. Market power always increases incentives for innovation and invention.
Is the unemployment rate the same for all groups of people in an economy? Why or why not?
What will be an ideal response?