Sulfur Dioxide Discharged (Tons)Firm AFirm B10$8,000$9,000910,00012,000815,00018,000720,00027,000628,00037,000
Table 9.7 shows the production cost for two utilities at different levels of sulfur dioxide emissions. Assume that the government issued 8 marketable pollution permits to each firm. If the two firms agree to swap one permit and split the difference between the willingness to pay and willingness to accept, what is the price of a permit?
A. $4,500
B. $5,500
C. $7,250
D. $9,750
Answer: B
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If there is currently a shortage of dollars, which of the following would you expect to see in the foreign exchange market?
A) The dollar will appreciate. B) There will be an increase in the supply of dollars. C) There will be an increase in the demand for dollars. D) The dollar will depreciate.
Refer to the table below for a certain product's market in Econland. If Econland were entirely closed to international trade, the equilibrium price and quantity would be:
A. $9 and 2,000 units
B. $8 and 1,800 units
C. $7 and 2,000 units
D. $6 and 1,400 units
The low point of the Great Depression was reached in the year
A. 1929. B. 1931. C. 1933. D. 1935.
Inferior goods have an income elasticity of demand that is
a. positive b. negative c. 0 d. greater than 1 in absolute value e. equal to 1 in absolute value