Describe the circumstances under which it would be better for the government to sell pollution permits than to levy a corrective tax
When the governmental authority (e.g., EPA) wants to restrict the quantity of emissions by a certain amount but does not know the demand curve for pollution, then it can auction off a certain number of pollution permits to achieve the desired result. Levying a corrective tax would involve guesswork as to the appropriate size of the tax.
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Average revenue, demand, and price are all depicted by the same curve for a monopoly
a. True b. False
Suppose that Adam and Sam each invest $5,000 in the same stock this year. Adam invests directly and earns 5% a year. Sam uses a retirement fund that charges an administrative fee and earns 4.75%. After 30 years, how much more money will Adam have than Sam?
a. $2,883.12 b. $2,526.78 c. $3,167.45 d. $3,044.62
Social Security, officially known as Old Age and Survivors Insurance (OASI),
a. collects funds from current workers and invests them in order to provide these workers with a stream of income during the retirement phase of life. b. is based on the same principles as private insurance programs. c. is an intergenerational income transfer program. d. is a voluntary savings program run by the government.
The WTO allows trade protection to protect endangered species
Indicate whether the statement is true or false