Voluntary agreements may not be a feasible method to internalize an externality when
A. the dollar value of the externality is large.
B. there are significant transaction costs.
C. the externality is negative rather than positive.
D. there are high taxes on the firms that cause the externalities.
Answer: B
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In answer to the question, "Who manages?" the answer is:
a. Everyone does b. Some people do sometimes c. Some individuals rarely manage anything d. It depends, some people manage, others don't
Because fiscal policy affects the quantity that the government borrows in financial capital markets, it not only affects aggregate demand, but it can also affect _____________ rates.
a. interest b. employment c. inflation d. wage
Suppose there are two countries that are identical in every way with the following exception: Country A has a higher saving rate than country B. Given this information, we know with certainty that
A) the growth rate will be higher in A than in B. B) the growth rate will be the same in the two countries. C) the level of consumption per worker will be higher in A. D) the level of consumption per worker will be higher in B.
The so-called Great Recession in the U.S.:
A. Is another name for the Great Depression B. Was the worst economic downturn since the Great Depression C. Was triggered by oil-supply shocks D. Was caused by a sharp increase in the value of the U.S. dollar