Explain why government subsidies are not always successful in promoting alternative energy
What will be an ideal response?
The federal government offered loans and subsidies to companies producing solar panels and batteries for electric-cars. The government assistant did not prevent these firms from shutting down. The low prices and oversupply caused firms in the solar panel market to shut down. The lack of demand for electric-car batteries is the reason businesses in that market failed. At the same time increases in oil and natural gas production caused further decreases in the price of energy, making the price of alternative electricity further decrease.
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If the probability of a bond default increases because corporations begin to suffer large losses, then the default risk on corporate bonds will ________ and the expected return on these bonds will ________, everything else held constant
A) decrease; increase B) decrease; decrease C) increase; increase D) increase; decrease
Refer to Scenario 2.1. If P = $15, which of the following is true?
A) Quantity supplied is greater than quantity demanded. B) Quantity supplied is less than quantity demanded. C) Quantity supplied equals quantity demanded. D) There is a surplus.
A firm enjoys a positive economic profit when:
a. the demand curve touches the average cost curve at the profit-maximizing level of output. b. the marginal revenue curve has a negative intercept on the ordinate axis. c. the average revenue curve lies below the average cost curve at the profit-maximizing level of output. d. the marginal cost is declining at the profit-maximizing level of output. e. the average revenue curve lies above the average cost curve at the profit-maximizing level of output.
The? self-interest theory of government explains why many states have limits on
A. taxes and government spending. B. the number of times politicians can be? re-elected. C. the number of people who can be? free-riders. D. all of the above