What is the rationale behind a cap-and-trade emission allowance system?
A) It creates a market for externalities.
B) It disciplines polluting firms by specifying the maximum amount of emissions allowed and gives them permits to pollute up to their allowance.
C) It provides firms with the incentive to consider less costly alternatives to pollution reduction by making firms pay for the right to pollute beyond their specified allowance.
D) It raises revenue for the government through the sale of permits.
C
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A tax is regressive if it
A. is levied on consumers. B. takes a smaller percentage of income as income increases. C. takes a higher percentage of income as income increases. D. takes the same percentage of income regardless of income level.
If a project involves risk, managers can account for the risk by ________ the discount rate, which ________ the present value of the future profits.
A) increasing; decreases B) decreasing; decreases C) increasing; increases D) decreasing; increases
The attempt to force employers to use more labor than they otherwise would, or to force employers to use labor inefficiently, is known as
A) a secondary boycott. B) a sympathy strike. C) a monopsony. D) featherbedding.
According to Peter principle, employees
A. do not always value promotions. B. should be promoted till they reach the top management level. C. keep getting promoted until they reach the level that they cannot handle. D. resort to influencing activities to ensure their promotions.