Which of the following methods can be used to sustain a cartel?
A) removing barriers to entry
B) trade groups
C) acts of self-interest
D) the use of binding contracts
B) trade groups
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Suppose two power plants pollute a river and both firms operate under a system of marketable pollution permits. If it costs Firm A $90 to reduce pollution by 800 units per day, and Firm B can reduce costs by $115 by increasing pollution by 800 units per day:
A. the firms cannot gain by trading the right to pollute. B. both firms can benefit if Firm A trades the right to increase pollution by 800 units to Firm B for $70. C. both firms can benefit if Firm B trades the right to increase pollution by 800 units to Firm A for $120. D. both firms can benefit if Firm A trades the right to increase pollution by 800 units to Firm B for $100.
Figure 1A.2Refer to Figure 1A.2. The slope between points a and c is:
A. -5. B. -6. C. 10. D. 30.
Social Security is financed:
A. by state income tax revenues. B. by payroll taxes on employees and employers. C. by federal excise taxes. D. out of general tax revenues.
Nations with single payer systems typically have
A. better access to high-tech medical solutions than in the U.S. B. higher life expectancies than in the U.S. C. serious inequality in the access to basic care. D. lower tax rates than exist in the U.S.