Which of the following might be a way that an automobile driver's pollution costs could be internalized?
A) The driver could purchase abatement equipment for her car.
B) The state could eliminate the gas tax.
C) The state could pay a gas subsidy for everyone who drives.
D) The state could allow her to drive in the HOV lane.
Answer: A
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In the summer 2012 the lobster catch in Maine was especially large, but instead of celebrating the fisherman were suffering from a lower total revenue. (Source: New York Times, July 28, 2012 ) As the lobster catch increases, there is
A) a movement along the demand curve, resulting in a higher price and a decreased quantity. B) a movement along the demand curve, resulting in a lower price and an increased quantity. C) no change in either the price or the quantity. D) a movement along the demand curve, resulting in a higher price and an increased quantity.
Rational ignorance is
A) a result of our educational system. B) the curtain, or wall, of knowledge between the persons that are educated and those that are not. C) the curtain behind which people choose to hide to avoid knowledge about poverty and, in general, the unequal distribution of income. D) the curtain separating educated voters from uneducated voters. E) none of the above
The best example of a "frictionally unemployed" worker is one who:
A. has lost their job because skills no longer match job requirements. B. is laid off during a recessionary period in the economy. C. is in the process of voluntarily switching jobs. D. reduces productivity by causing frictions in a business.
For inferior goods, demand will fall when
A. income decreases. B. price decreases. C. income increases. D. price increases.