One way for the government to eliminate a negative externality is to
A) charge an emissions fee.
B) set an emissions standard.
C) levy an effluent charge.
D) All of the above.
D
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Define comparative advantage and discuss its role in international trade
What will be an ideal response?
If the required reserve ratio is equal to 10 percent, a single bank can increase its loans up to a maximum amount equal to
A) its excess reserves. B) 10 times its excess reserves. C) 10 percent of its excess reserves. D) its total reserves.
When are black markets likely to arise?
A) when the government removes a price floor B) when the government enforces a price ceiling C) when there is a surplus of a good D) when the quantity supplied of a good exceeds the quantity demanded
"Protection" is designed to help
a. firms whose relative inefficiency does not permit successful competition with imports. b. workers who have very high productivity, and cannot survive against low-paid foreign workers. c. government that needs revenue from tariffs and quotas to cover government spending. d. firms that are highly efficient, and cannot survive against low-price foreign imports.