If benefit functions for a public good could be identified accurately, incremental benefits would be measured as
a. the area under the MSB function between the pre- and post-policy abatement levels.
b. the area under the TSB function between the pre- and post-policy abatement levels.
c. a horizontal distance on the MSB model corresponding to the pre- and post-policy abatement levels
d. none of the above
a. the area under the MSB function between the pre- and post-policy abatement levels.
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If the demand for pizza increases, then as a result, it is highly likely that the demand for:
A. soda will increase. B. mozzarella cheese will increase. C. chicken nuggets will fall. D. All of these are a likely result.
Suppose that 75 percent of a cigarette tax is borne by consumers. If the supply elasticity is 1, the demand elasticity is equal to:
A. 1/2. B. 1. C. 1/3. D. 1/4.
A decrease in AS will trigger less inflation under which of the following conditions?
A. AD is relatively steep. B. AD is relatively flat. C. AS is relatively steep. D. AS is relatively flat.
If a bond is sold in the secondary market,
a. the issuing firm is buying back its own bond b. the issuing firm does not obtain any part of the price c. the seller remits a portion of the price to the issuing firm d. the yield must be insufficient to justify sale on the primary market e. the seller is the issuing firm