Refer to the data provided in Table 16.3 below to answer the following question(s).Table 16.3 shows the situation facing two firms, both of which are polluting. Assume that each firm emits 5 units of pollution.Table 16.3Firm AFirm AFirm AFirm BFirm BFirm BReduction of Pollution by Firm AMC of reducing pollution for Firm ATC of reducing pollution for Firm AReduction of Pollution by Firm BMC of reducing pollution for Firm BTC of reducing pollution for Firm B1$8 $81$16$16212202 24 40318383 32 72426644 401125361005 48160Refer to Table 16.3. Suppose the government wants to reduce the total amount of pollution from the current level of 10 to 4. To do this, the government caps each firm's emissions at 2 units and issues 2 permits to each firm. If firms are allowed to trade
permits, how many permits will be traded between the two firms?
A. B will buy one permit from A.
B. A will buy two permits from B.
C. B will buy two permits from A.
D. A will buy one permit from B.
Answer: A
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Using the exact formula, the nominal interest rate equals:
a. Real interest rate + Actual inflation + (Real interest x Actual inflation). b. Real interest – Expected inflation. c. Real interest + Expected inflation + (Real interest x Expected inflation). d. Real interest – Expected inflation – (Real interest x Expected inflation).
The most commonly accepted cause of the European Crisis is:
a. Fiscal profligacy b. Too little welfare spending c. Unemployment d. Current account deficit
Rafael is the newly-appointed plant manager for a company that manufactures head phones. Rafael's senior supervisors told him that the output the firm produces, given the number of workers employed, indicates that some workers may be shirking. According to efficiency wage theory, what should he do?
a. pay all workers more than the equilibrium wage rate b. pay all workers below the equilibrium wage rate to make up for the loss from shirking c. make sure that workers are getting paid exactly the equilibrium wage rate d. fire the workers with the most seniority
Profit-maximizing price level
A. is OE.
B. is OF.
C. is OG.
D. cannot be found on this graph.