Figure 9.9 depicts a market for electricity. S1 is the supply curve without the external costs. S2 is the supply curve with the $T tax. Assume electricity production incurs external costs. If the government imposes a pollution tax in the amount illustrated, the amount of the pollution tax borne by the electricity producers is:
A. PA - PB.
B. PA - PC.
C. PB - PC.
D. (1/2)?(PA - PB).
Answer: C
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If U.S. residents want to buy more foreign bonds, then in the market for foreign-currency exchange the exchange rate
a. and the quantity of dollars traded rises. b. rises and the quantity of dollars traded falls. c. falls and the quantity of dollars traded rises. d. and the quantity of dollars traded falls.
Considering the United States to be a capital-abundant country, which of the following facts would contradict the predictions of the Heckscher-Ohlin theory?
A. The United States is a net importer of labor-intensive products. B. The United States is a net importer of capital-intensive products. C. The United States is a net importer of certain natural resources such as petroleum. D. The United States is a net importer of products that use farmland intensively.
If the reserve ratio is 0.9, the money multiplier will be 10.
Answer the following statement true (T) or false (F)
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, a decrease in unemployment may be represented by the movement from
A. B to A. B. C to D. C. B to D. D. A to C.