The government is considering levying a tax on the pollution generated from two electric power plants (Plant A and Plant B). Plant A is located in a city with a high density of population, and Plant B is located in the rural area with a low density of
population. The government should
A) levy the same tax per unit of pollution on both plants.
B) levy a higher tax per unit of pollution on Plant A because of its higher economic damage.
C) levy a higher tax per unit of pollution on Plant B because of its lower economic damage.
D) tax only Plant A but not Plant B because Plant B generates less revenue.
Answer: B
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Some of the cost curves for Ike's Ice Cream Kitchen are given in the above figure. At which of the following levels of output does the marginal product of labor equal the average product of labor?
A) at 0 gallons B) at 10 gallons C) at 40 gallons D) at 60 gallons
Eurobonds are bonds that are
A) sold outside the borrowing corporation's home country. B) sold in Europe. C) money market instruments. D) almost always underwritten by a single bank.
Suppose there are no firms, only the government and households. What would the total demand for funds curve look like in such a world?
a. Downward sloping b. Perfectly horizontal c. Upward sloping d. There would be no such curve e. Perfectly vertical
The three reasons why the aggregate demand curve slopes downward are
a. the international substitution effect, the net exports effect and the interest rate effect. b. the interest rate effect, the short run effect and the free rider effect c. the net exports effect, the real balance effect and the short run effect d. the real balance effect, the international substitution effect and the interest rate effect.