Suppose an oil refinery and a paper mill both pollute a river. Under a system of marketable pollution permits, which of the following must be true in order for both companies to benefit from trading the right to pollute?
A. They must be able to reduce pollution at exactly the same cost.
B. It must cost the firms different amounts to reduce pollution.
C. They must have a social conscience and must be devoted to pollution abatement.
D. The government must direct them toward beneficial trades.
Answer: B
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Transfer payments
A) are included in the government expenditure category in gross domestic product. B) refer to all payments made to households by governments. C) refer to payments made by the government that are not made to purchase a good or service. D) are made by households to firms in exchange for goods and services.
The slope of the total product curve always equals
A) the ratio of the marginal product and the average product. B) the change in input divided by the change in output. C) the average product of the input. D) the marginal product of the input.
Which of the following is true of sub-Saharan Africa?
a. The poverty rate in the region is low. b. The region has received more foreign aid than any other area of the world. c. Most of the countries in the region rank among the freest economies in the world. d. The poverty rate in the region is the lowest of any region in the world, and the rate has declined sharply during the past quarter of a century.
Sally is on her college golf team and only uses Titleist golf balls. She states: "I don't care what the price is, I will only buy Titleists." Is this a believable assertion?