Dry cleaning of clothing produces air pollutants. Therefore, in the market for dry cleaning services, the equilibrium price
A) and output are too low to be optimal.
B) and output are too high to be optimal.
C) is too low to be optimal, and equilibrium quantity is too high.
D) is too high to be optimal, and equilibrium quantity is too low.
E) is optimal, but there is an excess supply.
C
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If American demand for purchases of Mexican goods has increased, how would you expect the equilibrium exchange rate in the market for dollars to respond? Support your answer graphically
What will be an ideal response?
Fogel's work (1964) on the economic impact of railroads is mostly written in response to
(a) Rostow's takeoff theory. (b) Schumpeter's theory of railroads building ahead of demand. (c) David's theory of path dependency. (d) Engerman's theory of multiroute analysis.
A government program would impose a 25-cent tax on each pack of cigarettes in order to fund welfare programs. Such a policy
a. is not a Pareto improvement b. is an example of an economically inefficient economy c. would clearly not increase tax revenues d. is a Pareto improvement e. could only occur in a fair economy
A firm sells a product in a purely competitive market. The marginal cost of the product at the current output is $3.00 and the market price is $2.50. What should the firm do?
A. Shut down if the minimum possible average variable cost is $2.00. B. Decrease output if the minimum possible average variable cost is $2.00. C. Increase output if the minimum possible average variable cost is $2.50. D. Increase output if the minimum possible average variable cost is $2.00.