Externalities can be internalized through voluntary agreements as long as
A. transaction costs are low relative to expected benefits.
B. transaction costs are high relative to expected benefits.
C. the agreement is a short-run agreement.
D. the agreement is a long-run agreement.
Answer: A
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The figure below shows a single consumer's demand for ice cream at the student union. 
Fran is one of the students whose demand curve for ice cream is shown above. When price is $4.00, Fran demands ________ scoops a week, and when price is $2.00, Fran demands ________ scoops.
A. 1; 3 B. 2; 6 C. 2; 4 D. 2; 5
Sam has $500 in traveler's checks. He cashes a $100 traveler check, deposits $150 into his checking account at a Savings and Loan Association, and deposits the remaining $250 into a savings account at a credit union. Immediately, ________
A) M1 decreases by $250 and M2 does not change B) M1 decreases by $400 and M2 increases by $250 C) M1 does not change and M2 increases by $250 D) M1 and M2 do not change
You have won a contest and are allowed to choose between two prizes. One option is to receive $200 today and another $200 one year from now. The second option is $100 today and an additional $325 one year from now
At what interest rate (if any) is the present value of the two prizes identical? A) 0 percent B) 5 percent C) 10 percent D) 25 percent E) none of the above
If the United States borrows a large amount of money from other countries to pay for a trade deficit
A. this is not necessarily a problem if the economy is growing fast enough to have future income to pay back the accumulated debt. B. this will hurt the U.S. economy unless the United States is able to pay off the debt by increasing manufacturing exports. C. this will necessarily slow the U.S. growth rate, compared to a situation in which the United States has a trade surplus. D. American firms will have to repay the debt with shares of stock or real estate, which will put American firms at a disadvantage compared to foreign firms.