Suppose the market for oranges is perfectly competitive and unregulated. Suppose also that the chemicals used to keep the oranges insect-free damage the environment by an estimated $1 per bushel of oranges. Suppose QD = 1000 - 100P and QS = -100 + 100P. The total dollar value damage to society is
a. 400
b. 450
c. 500
d. 550
b
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Which of the following are assumptions behind the Coase theorem?
A) low transactions costs B) low levels of pollution C) high levels of pollution D) the necessity of government intervention
Suppose the demand for barley is perfectly elastic. The supply curve of barley is upward sloping. If a tax is imposed on barley,
A) barley sellers pay the entire tax. B) barley buyers pay the entire tax. C) the government pays the entire tax. D) the tax is split evenly between barley buyers and sellers. E) who pays the tax depends on whether the government imposes the tax on barley sellers or on barley buyers.
Goods that are produced in other countries and then sold domestically are called
A) exports. B) imports. C) tariffs. D) quotas.
There are 20 residents in the village of Towneburg. The size of the village's annual fireworks display depends upon the number of shells that are fired off. Each resident's demand for fireworks is shown below. The total cost of the fireworks display is $1,000 plus $10 per shell.
What is the vertical intercept of the village's demand curve for fireworks?
A. 25 B. 1,000 C. 50 D. 10