________ is(are) an example of selling externality rights.
A. Having the damaged party avoid the damage
B. Auctioning the right to buy a car each year
C. Direct regulation of externalities
D. Government imposed taxes and subsidies
Answer: B
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Average costs curves initially fall
a. Due to declining average fixed costs b. Due to rising average fixed costs c. Due to declining marginal costs d. Due to rising marginal costs
Mrs. Dodge has $8 million in income and pays no income taxes. Her income is most likely
a. capital gains. b. interest on corporate bonds. c. interest on municipal bonds. d. offset by mortgage interest.
As a group, oligopolists would always earn the highest profit if they would
a. produce the perfectly competitive quantity of output. b. produce more than the perfectly competitive quantity of output. c. charge the same price that a monopolist would charge if the market were a monopoly. d. operate according to their own individual self-interests.
What component of GDP is particularly volatile over the business cycle and can be targeted by tax cuts?