If the marginal cost of water pollution abatement is increased, then the optimal amount of water pollution increases.
Answer the following statement true (T) or false (F)
False
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The short-run Phillips curve shows
A) a tradeoff between the unemployment rate and the inflation rate. B) a tradeoff between real GDP and unemployment. C) the expected inflation rate. D) the natural unemployment rate. E) potential GDP.
Why is the study of asymmetric information associated with the market for "lemons"?
A) Potential buyers of used cars have difficulty separating good used cars from bad used cars; bad used cars are often referred to as "lemons." B) Because there is little advertising in the market for lemons, buyers have difficulty determining the quality of lemons before they are purchased. C) Sellers of citrus fruit — lemons, oranges, grapefruit — know the difference between bad fruit and good fruit; buyers do not have this information. D) Most sellers of used cars have less information about their cars than the dealers who buy them; used cars are often referred to as "lemons."
Explain why it may make sense for the United States, Japan, and Europe to allow their mutual exchange rate to float?
What will be an ideal response?
When marginal private cost is less than marginal social cost,
A. a public good exists. B. a negative externality exists. C. a positive externality exists. D. negative economic profits are made. E. a and d