A pollution compensation tax is chosen to
a. keep output stable while reducing pollution
b. increase output in a cleaner manner
c. make all users pay the same amount of tax
d. drive the polluting firms out of business in the long run
e. create enough government revenue to clean up the environment
E
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As the real interest rate increases, the quantity of saving supplied ________ and the quantity of saving demanded ________.
A. increases; decreases B. does not change; does not change C. increases; increases D. decreases; increases
If an economy is growing, but experiences no inflation, this means
a. aggregate demand increased, but aggregate supply did not. b. aggregate supply decreased, but aggregate demand did not. c. aggregate demand and aggregate supply increased by the same amount. d. aggregate demand and aggregate supply decreased by the same amount.
High monopoly profits are possible if each of the oligopolists in a market: a. cooperates by reducing its output
b. cooperates by reducing its price. c. pursues self-interest by increasing its output. d. pursues self-interest by decreasing its output.
Juan is currently spending all of his income. For the last unit of Good X consumed Juan gets 20 utils and for the last unit of Good Y consumed he gets 10 utils. The price of Good X is $10. The price of Good Y is $1. If Juan wants to maximize his utility he should
A. continue to purchase the same amount of Good X and Good Y. B. increase the consumption of Good X and decrease the consumption of Good Y. C. decrease the consumption of Good X and increase the consumption of Good Y. D. decrease the consumption of Good X and decrease the consumption of Good Y.