A market for pollution rights can be expected to:
A. Eliminate all pollution
B. Produce a shortage of pollution
C. Encourage potential polluters to increase emissions
D. Provide potential polluters with a monetary incentive to reduce emissions
D. Provide potential polluters with a monetary incentive to reduce emissions
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An R2 close to 1
A) does not happen with real data. B) indicates that almost all of the variation in the dependent variable is explained by the regression. C) does not explain variation as well as an R2 that is above 2. D) means that the regression line does not fit the data very well.
A business incurs the following costs per unit: Labor $125/unit; Materials $45/unit and rent $250,000/month. If the firm produces 1,000,000 units a month, the total fixed costs equal
a. $250,000 b. $50,000 c. $20,500 d. $30,000
Crowding out would most likely occur when:
A. the federal government engages in bond sales to finance its budget deficit. B. tax receipts rise more slowly than anticipated, resulting in the need to cut government spending. C. workers lose jobs as a result of anti-inflationary fiscal policies. D. Congress enacts budget cuts to balance the budget.
Assume that an economy experiences both positive population growth and technological progress. Once the economy has achieved balanced growth, we know that the capital per effective worker ratio (K/NA) is
A) growing at a rate of ? + gA + gN. B) growing at a rate of gA + gN. C) growing at a rate of gN. D) growing at a rate of gA. E) none of the above