The pollution tax in Figure 9.10:
A. reduces equilibrium output.
B. reduces equilibrium price.
C. increases supply.
D. All of these
Answer: A
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Refer to Scenario 5.8. The value to Icarus Airlines of complete information is
A) $40 million. B) $90 million. C) $115 million. D) $120 million. E) $125 million.
New Keynesian theory differs from new classical theory in that New Keynesian theory assumes that wages and prices are not completely flexible in the short-run, while fully flexible wages and prices are an assumption of new classical theory
Indicate whether the statement is true or false
M1 refers to:
A. Federal Reserve Notes and gold certificates. B. currency held by the public plus checking account balances. C. the largest of the money-supply definitions. D. bank loans.
Suppose a blackjack gambler approaches an insurance company and seeks to purchase an insurance policy that his next trip to Reno, NV will not net $10,000. The insurance company
A) will sell her an insurance policy because the proposal entails uncertainty not risk. B) will sell her an insurance policy because the proposal entails risk not uncertainty. C) will not sell her an insurance policy because the proposal entails uncertainty not risk. D) will not sell her an insurance policy because the proposal entails risk not uncertainty.