Compared to taxing pollution, an advantage of auctioning pollution permits is that:
A. it allows the public to directly reduce pollution by purchasing permits.
B. it ensures that all firms reduce pollution by the same amount.
C. the largest reductions in pollution are made by the firms that can do so the most cheaply.
D. auctioning permits raises revenue for the government.
Answer: A
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Which of the following pairs of variables are likely to be positively correlated?
A) Income and consumption B) Price and consumption C) Education and unemployment D) Availability of health care and death rate
The Phillips Curve shows the trade-off between:
a. unemployment and output. b. inflation and output. c. unemployment and inflation. d. imports and exports. e. unemployment and imports.
Crises that occasionally hit financial markets will increase the demand for money since:
A. the risk of holding money relative to other financial assets decreases. B. the return on financial assets increases. C. the return on money increases. D. there is no risk with holding money.
Hurricane Katrina destroyed much of New Orleans and other parts of the South. Which of the following statements is true? The hurricane:
A. caused the production possibilities frontier of the United States to shift. B. caused the production possibilities to increase, since it created a lot of work to rebuild the city affected areas. C. caused the production possibilities frontier of the United States to shift in. D. didn't change the production possibilities frontier, but moved from a point on the frontier to a point inside the frontier.