Explain some important situations where direct controls have a clear advantage over taxes.
What will be an ideal response?
| 1. | Where an emission is so dangerous that it must be prohibited altogether. |
| 2. | Where a sudden change in circumstances calls for prompt and substantial changes |
| 3. | Where effective and dependable pollution-metering devices have not been invented or are prohibitively costly to install and operate. |
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A balance of payments surplus occurs if
A) the supply of a nation's currency is equal to the demand for the currency at the current exchange rate. B) exports exceed imports. C) the supply of a nation's currency exceeds the demand for the currency at the current exchange rate. D) the demand for a nation's currency exceeds the supply of the currency at the current exchange rate.
An increase in the wage rate ______
A. shifts the average total cost curve and the marginal cost curve upward B. shifts the average fixed cost and average variable cost curve upward C. increases average variable cost but does not change marginal cost D. does not change average variable cost but increases average total cost
Facing stiff competition, Hendrix College, a small liberal arts institution in Conway, Ark
, decided two years ago to bolster its academic offerings, promising students at least three hands-on experiences outside the classroom, including research, internships and service projects. Although it raised tuition and fees by 29 percent, enrollment in the freshman class rose by 37 percent. Source: Jonathan D. Glater and Alan Finder, "In New Twist on Tuition Game, Popularity Rises With the Price," New York Times, December 12, 2006 Based on the information above, the demand for Hendrix College education is A) relatively elastic. B) unit elastic. C) perfectly elastic. D) More information is needed to answer the question.
Which of the following most resembles a perfectly competitive market?
A. The stock market B. The publishing industry C. The steel industry D. The new car market