In some cases, tradable pollution permits may be better than a corrective tax because
a. pollution permits allow for a market solution while a corrective tax does not.
b. pollution permits generate more revenue for the government than a corrective tax.
c. pollution permits are never preferred over a corrective tax.
d. the government can set a maximum level of pollution using permits.
d
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Refer to Figure 7-4. Suppose the U.S. government imposes a $0.25 per pound tariff on rice imports. Figure 7-4 shows the demand and supply curves for rice and the impact of this tariff. Use the figure to answer questions a-i
a. Following the imposition of the tariff, what is the price that domestic consumers must now pay and what is the quantity purchased? b. Calculate the value of consumer surplus with the tariff in place. c. What is the quantity supplied by domestic rice growers with the tariff in place? d. Calculate the value of producer surplus received by U.S. rice growers with the tariff in place. e. What is the quantity of rice imported with the tariff in place? f. What is the amount of tariff revenue collected by the government? g. The tariff has reduced consumer surplus. Calculate the loss in consumer surplus due to the tariff. h. What portion of the consumer surplus loss is redistributed to domestic producers? To the government? i. Calculate the deadweight loss due to the tariff.
The Official Settlements Balance is another way of describing
A) the actual tabulation of reserve assets held by government central banks and treasuries. B) the net value of merchandise trade between two nations. C) the net foreign direct investment between two countries. D) the actual value in one currency of trade divided by the value in a second currency.
Discretionary monetary policy is when the monetary authority:
a. does not commit to future monetary actions. b. never produces a monetary surprise to households. c. commits to future monetary actions. d. always behaves in a predictable way.
If psychological limitations and other complications cause people to be unable to examine and think through every possible choice available to them and rely instead on rules of thumb, then these individuals exhibit
A) completely irrational behavior. B) normative thinking. C) bounded rationality. D) positive thinking.