Unpriced by-products of production or consumption that impose costs on other consumers or firms are known as
a. negative externalities
b. effluent fees
c. pollution rights
d. positive externalities
e. moral hazards
A
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Which of the following statements is true?
A) Exponential growth refers to growth by the same amount in every time period. B) To depict variables that have exponential growth, it is more convenient to use an axis with a proportional scale. C) Linear growth refers to growth by the same proportion in every time period. D) To depict variables that have exponential growth, it is more convenient to use an axis with a linear scale. Consider two countries: country A and country B. At the beginning of year 2010, the GDP per capita in both countries is $2,400. The annual growth rate of output in country A is 3%, while the annual growth rate of output in country B is 5%.
Fred Monroe is a fisherman in the perfectly competitive fish industry in northern Minnesota. After years of experience, he knows that the demand curve for the fish he sells is
a. horizontal b. vertical c. downward sloping d. the same as the industry demand e. upward sloping
If Ana devotes all her time to making fudge, she can make 3 pounds of fudge an hour, and if she devotes all her time to making toffee, she can make 2 pounds of toffee an hour. If Leo devotes all his time to making fudge, he can make 4 pounds of fudge an hour, and if he devotes all his time to making toffee, he can make 5 pounds of toffee an hour. Which of the following statements is correct?
A. Leo has both the absolute advantage and the comparative advantage in fudge. B. Ana has the comparative advantage in toffee, but Leo has the absolute advantage in toffee. C. Ana has the comparative advantage in fudge, but Leo has the absolute advantage in fudge. D. Ana has both an absolute advantage and the comparative advantage in fudge.
The optimal amount of air pollution is
A) found by equating the marginal benefits from reducing pollution by one more unit with the marginal costs of reducing pollution by an additional unit. B) found by equating the total benefits from reducing pollution by one more unit with the total costs of reducing pollution by an additional unit. C) found by setting the marginal benefits from reducing pollution by one more unit equal to zero. D) a meaningless concept since we cannot monetize the environment.