Two companies, Dirty Inc. and Filthy Inc., each of which has access to 5 different production processes, each of which has a different cost and produces a different amount of pollution. The daily costs of the processes and the number of tons of smoke emitted are shown in the table below.ProcessABCDE(smoke/day)(4 tons/day)(3 tons/day)(2 tons/day)(1 tons/day)(0 tons/day)Cost to Dirty Inc. ($/day)$100$200$380$740$1,460Cost to Filthy Inc. ($/day)$400$430$490$580$700 Suppose pollution is initially unregulated. If the City Council imposes a tax of $91 per day on each ton of smoke emitted, then total emissions will fall to ________ tons of smoke per day.
A. 1
B. 4
C. 2
D. 8
Answer: B
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Government provide public goods such as national defence because:
a) governments are more efficient than private firms at producing public goods b) people do not value national defence very highly c) of the potential that private firms will make excess profit d) of the free-rider problem which results in underproduction by private firms
According to the Keynesian savings schedule, when aggregate income increases by a given amount, savings will
A) remain the same B) decrease by the amount of change in income C) increase by the amount of the change in income D) increase by less than the amount of the change in income E) increase by more than the amount of the change in income
The struggle among various producers for the consumer's business called ____________ .
a. socialism b. competition c. incentive d. self-regulation
Market power may result from all of the following except
A. Patents and copyrights. B. Efficiencies of large-scale production. C. Control of resources. D. Low barriers to entry.