Which one of the following statements is false if we increase the discount rate used to allocate a resource across two time periods?

a. The resource will tend to be used up quicker
b. The price of the resource will tend to rise faster
c. Current consumption of the resource will increase
d. The appropriate resource depletion tax will increase
e. Future supplies of the resource will decrease


Ans: d. The appropriate resource depletion tax will increase

Economics

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A production possibilities curve shows the:

a. dollar costs of producing two different goods. b. amounts of labor and capital needed to produce one good. c. various combinations of goods that can be produced. d. prices of different goods that are produced in an economy. e. inefficient use of available resources and technology.

Economics

As an additional consumer obtains the benefits of a public good such as national defense, the benefits to existing consumers: a. decline

b. increase. c. increase in the short run, but decrease in the long run. d. do not change.

Economics

If pollution is reduced below the socially efficient level:

a. the marginal cost of pollution abatement exceeds the marginal benefit of pollution abatement
b. the marginal cost of pollution abatement is less than the marginal benefit of pollution abatement.
c. the marginal cost of pollution abatement equals the marginal benefit of pollution abatement.
d. nothing can be said about the relationship between the marginal cost and marginal benefit of pollution abatement.

Economics

Experience rating systems for pricing insurance discourage firms from spending money to try to improve their employees' health.

Answer the following statement true (T) or false (F)

Economics