In order to achieve an efficient result a pollution tax must:
A. be equal to the external cost generated.
B. not be passed through to the consumers of the produced good.
C. be equal to the social cost of production.
D. be shared equally by the producer and the consumer of the produced good.
Answer: A
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A single-price monopoly is characterized by a marginal revenue curve that is
A) upward sloping. B) downward sloping. C) horizontal. D) vertical.
Firms that contain some divisions that produce parts and components to be used by other divisions in order to generate finished goods are said to be:
A) horizontally integrated. B) vertically integrated. C) multinationals. D) corporations.
Suppose an American worker can make 20 pairs of shoes or grow 100 apples per day. On the other hand, a Canadian worker can produce 10 pairs of shoes or grow 20 apples per day. The opportunity cost for the United States is:
A. 5 apples for each pair of shoes. B. 5 pairs of shoes for each apple. C. 1/5 apple for each pair of shoes. D. 1 pair of shoes for every 2 apples.
In a market system, decisions about how to allocate resources are made: a. by central planning boards in each industry
b. by a lottery system. c. by individuals and firms interacting in markets coordinated by market prices. d. by large conglomerates working cooperatively with the government.