Store of value
Federal reserve notes, debit card, passbook savings deposit
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Suppose pollution, which generates a negative externality, exists in a market. If transactions costs are low and parties are willing to bargain, then, according to the Coase theorem,
A) an equitable solution can only be reached if property rights are assigned to the victims of pollution and not the polluters. B) an equitable solution can only be reached if property rights are assigned to the polluters, and not the victims of pollution. C) an efficient solution can be reached regardless of the initial assignment of property rights. D) government intervention is necessary to reach an efficient and equitable solution.
Suppose the price of chocolate chip cookies is $4.00 per pound and the price of a slice of cake is $2.00 per slice. The relative price of cake in terms of cookies is
A) 1/2 pound of cookies per cake. B) 2 pounds of cookies per cake. C) 1/2 slice of cake per cookie. D) 2 slices of cake per cookie.
Assuming peaches are a normal good and consumer incomes rise, producer surplus in the peach market:
a. increases. b. decreases. c. remains unchanged. d. equals the deadweight loss increase.
When consumers decide to increase household debt, this action will:
A. Shift the consumption schedule upward B. Shift the consumption schedule downward C. Increase the amount consumed along a stable consumption schedule D. Decrease the amount consumed along a stable consumption schedule