In economic analysis, the optimal level of pollution
A) is always zero.
B) arises at the point at which the marginal benefit from further reduction equals the marginal cost of further reduction.
C) occurs at the point at which demand crosses the private cost supply curve.
D) should be determined by the private market without any government intervention.
B
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As the economy enters a strong expansion in which real GDP increases, which of the following occurs?
A) The demand for money decreases and there is a movement upward along the demand for money curve. B) The demand for money increases and there is a movement downward along the demand for money curve. C) The demand for money curve shifts rightward. D) The nominal interest rate falls as the demand for money curve shifts leftward. E) The demand for money curve shifts leftward.
When constructing an overall measure that shows inflation in the prices of many different items, economists consider: a. the average of the price changes of all goods
b. the total cost of purchasing a basket of goods and services. c. the changes in the prices of only luxury goods. d. the changes in the prices of only nondurable goods.
Stricter environmental regulations and increased demand for energy have caused an increase in the demand for relatively clean natural gas. In the last several years, improved extraction technologies and new discoveries have increased the availability of natural gas. What has been the net effect on price and quantity for natural gas?
A. Quantity sold rose while the effect on price is ambiguous. B. Quantity sold fell and the effect on price is ambiguous. C. Quantity sold and price both rose with certainty. D. Quantity sold and price both fell with certainty.
The proponents of ________ and ________ think that the Federal Reserve should adopt a constant monetary growth rule
A) new Keynesianism; the new classical model B) the real business cycle model; Marxism C) the monetarist model; the Keynesian model D) rational expectations; monetarism