Which of the following statements is not correct?
a. Patents help internalize the externalities associated with technological advances.
b. Economists typically prefer regulations to corrective taxes because regulations provide more incentives for firms to seek continued reductions in pollution.
c. Allowing firms to trade pollution permits will lower the total cost of reducing pollution.
d. A big impediment to implementing the Coase theorem in many cases is high transactions costs.
b
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Specialization implies that an individual should produce the good for which he/she has the ________ opportunity cost.
A. necessary B. highest C. general D. lowest
What leads to a decrease in the quantity demanded of a good or service?
What will be an ideal response?
What impact might a decrease in the U.S. federal budget deficit have on interest rates and exchange rates in the market for the U.S. dollar? (Assume the exchange rate is stated in terms of foreign currency per U.S. dollar.)
A) Interest rates and exchange rates decrease. B) Interest rates and exchange rates increase. C) Interest rates increase and exchange rates decrease. D) Interest rates decrease and exchange rates increase.
In the short-run, a supply shock will lead to
A) movement of prices and output in the same direction. B) movement of prices and output in opposite directions. C) a sustained inflation. D) a movement in prices, but not output.