Two companies, Dirty Inc. and Filthy Inc., each of which has access to 5 different production processes, each of which has a different cost and produces a different amount of pollution. The daily costs of the processes and the number of tons of smoke emitted are shown in the table below.Process(smoke/day) A(4 tons/day) B(3 tons/day) C(2 tons/day) D(1 ton/day) E(0 tons/day) Cost to Dirty Inc. ($/day) $110$200$380$740$1,460 Cost to Filthy Inc. ($/day) $400$430$490$580 $700If the City Council imposes a tax of $91 per day on each ton of smoke emitted, then what will be the total cost to society of the resulting reduction in pollution?
A. $180
B. $360
C. $90
D. $270
Answer: D
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A) IS curve shifts to the left. B) IS curve shifts to the right. C) LM curve shifts upward. D) LM curve shifts downward.
Which of the following is NOT one of the determinants of the gains of adopting a single currency?
A) A well-synchronized business cycle involving all member countries B) The possibility of factors of production to freely move across borders C) The willingness and ability of member countries to design policies to address regional imbalances that may develop D) Widening the common market by allowing other countries to join
A cartel might fail because
A) it does not control enough of the output in a market to raise prices enough. B) there is an incentive for members to cheat. C) too many firms leave the cartel, causing the cartel price to fall. D) All of the above.