Under a system of transferable pollution rights, which of the following firms is most likely to purchase a $500 permit to emit a ton of pollutants in to the atmosphere?
a. a non-polluting firm
b. a polluting firm that can reduce emissions at a cost of $500 per ton
c. a polluting firm that can reduce emissions at a cost of $200 per ton
d. a polluting firm that can reduce emissions at a cost of $600 per ton
d
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When the velocity of circulation equals 4 in 2010, this fact means that
A) consumers held four dollars in wealth for each dollar they spent in 2010. B) on average, each dollar of money in the economy purchased four dollars of goods and services in GDP in 2010. C) for each additional dollar of money injected into the economy, the price level rose 4 percent in 2010. D) real output of goods and services in GDP rose by four dollars for each additional dollar of money consumers saved.
Alan Krueger conducted a survey of fans at the 2001 Super Bowl who purchased tickets to the game for $325 or $400
Krueger found that (a) 94 percent of those surveyed would not have paid $3,000 for their tickets, and (b) 92 percent of those surveyed would not have sold their tickets for $3,000. These results are evidence of A) the high value fans place on watching the Super Bowl in person, rather than on television. B) the failure of consumers to ignore sunk costs. C) consumers being overly optimistic about their future behavior. D) the failure of consumers to take into account nonmonetary opportunity costs.
Which of the following is NOT a non-price determinant of demand?
A) the price of the good or service B) tastes and preferences C) expectations of future prices D) prices of related goods and services
If the absolute price elasticity of demand for automobiles is equal to 0.75, we say
A) that demand is inelastic. B) that demand is elastic. C) that there is a strong responsiveness of quantity demanded to automobiles price cuts. D) none of the above is correct.