The formula Es/(Es - Ed) is used to calculate the
A) deadweight loss from price support programs.
B) increase in consumer surplus from a price ceiling.
C) fraction of a specific tax that is passed through to consumers.
D) none of the above
C
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If a pollution tax in a market with an external cost changes the market so that it produces the efficient level of output, which of the following occurs?
i. The supply curve shifts leftward. ii. The price increases. iii. The quantity produced decreases. A) i only B) ii only C) iii only D) i and ii E) i, ii, and iii
A market in which businesses, households, and governments buy and sell national currencies is
A) the foreign exchange market. B) the currency exchange market. C) the money exchange market. D) the dollar exchange market.
A key to analyzing subgame perfect equilibrium strategy in sequential games is
a. predictable behavior b. an explicit order of play for at least some participants c. information sets that are known with certainty d. credible threats clearly communicated e. randomness
Compare the effectiveness of fiscal policy in an open economy with mobile international capital to fiscal policy in a closed economy. Why is it different? Use an appropriate diagram to illustrate your answer