A stairwell in a certain office building is always congested at 12:00 p.m. and 1:00 p.m. The congestion is so bad that people have been complaining to the building's owner. Which of the following methods would be the most efficient way of reducing congestion?
a. Assign each person in the building a time when they are allowed to use the stairwell.
b. Encourage people to voluntarily keep off the stairwell during peak times.
c. Charge everyone who uses the stairwell when it is congested the same fee. People who value the use of the stairs the most will be the ones who use the stairwell at peak times.
d. Hold a lottery to determine who wins the right to use the stairwell at peak times.
c
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In the multiple-polluter case for a pollution permit system, suppose Firm 1 and Firm 2 face marginal abatement cost functions of MAC1 = 4.5A1 and MAC2 = 2.25A2, respectively. If the government issues each firm tradeable pollution permits such that each has to abate 10 units of pollution, then, based on this allocation,
a. the two firms have no incentive to trade b. firm 1 has an incentive to buy a permit if the price is greater than $45 c. firm 2 has an incentive to buy a permit if the price is above $22.50 d. firm 2 will be willing to sell a permit if the price is above $22.50
Suppose you are very picky about your outdoor BBQ experiences --- and you need exactly 1 cup of lighter fluid for each bag of charcoal you use. If you have either leftover charcoal or leftover lighter fluid, you simply discard it. a. With cups of lighter fluid on the horizontal and bags of charcoal on the vertical axis, illustrate some of your indifference curves. b. Suppose that your favorite charcoal has just gotten better because the producer has infused the charcoal with half a cup of lighter fluid per bag. How does your answer to (a) change? c. How could you change the units in which lighter fluid is measured on the horizontal axis to get your graph from (b) to look the same as you original graph in (a)?
What will be an ideal response?
In the long run, perfectly competitive firms cannot make an economic profit. Why?
What will be an ideal response?
Besides world trade growth, what can explain the growth of international banking since the 1960s?
A) war in the Middle East B) government focus on banking regulation. C) an increase in world travel. D) the emergence of developing countries like China. E) desire of depositors to hold currencies outside the jurisdiction of the countries that issue them