Describe how a pollution-control authority might use an emissions permits system to reduce pollution
An authority could create a permit for a specified quantity of a specific pollutant, such as a ton of sulfur dioxide of air pollution or a pound of sewage entering the water. The permits could be offered for sale in limited quantities fixed by the authority at prices set by supply and demand. (Supply is totally inelastic in this market.) The permits can be auctioned off to the highest bidder. Polluters have the choice to buy a permit or clean up and do without. It is a price-based approach, which tends to be efficient. It has the further advantage of reducing pollution to a known, specific amount based on the number of permits. It has the disadvantage of being viewed as a "license to pollute" and may be unpopular with the public.
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Of the following, when would the U.S. exchange rate rise the most?
A) when the supply of and demand for U.S. dollars increase B) when the supply of U.S. dollars increases and the demand for them decreases C) when the supply of U.S. dollars decreases and the demand for them increases D) when the supply of and demand for U.S. dollars decrease
In the above figure, what would be the wage paid and quantity of labor employed under competitive market conditions compared to monopsony conditions?
A) W1 and L1 with competition versus W2 and L2 with monopsony B) W2 and L2 with competition versus W1 and L1 with monopsony C) W2 and L2 with competition versus W3 and L1 with monopsony D) W3 and L3 with competition versus W3 and L1 with monopsony
If the price of oil, a close substitute for coal, increases then the
a. supply curve for coal will shift to the right. b. demand curve for coal will shift to the right. c. equilibrium price and quantity of coal will not change. d. demand curve for coal will shift to the left. e. supply curve of coal will shift to the left.
The cost or benefit of a market activity borne by a third party is
A. A monopoly. B. An externality. C. A government directive. D. Black-market economic activity.