Which of the following is an example of a negative externality (additional social cost)?
A. an increase in the value of land you own when a nearby development is completed
B. the costs paid by a company to build an automated factory
C. the higher price you pay when you buy a heavily advertised product
D. falling property values in a neighborhood where a disreputable nightclub is operating
Answer: D
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Refer to the scenario above. Phillip should play this game using ________
A) backward induction B) forward induction C) mixed strategies D) his dominated strategy
How are tradable pollution permits used?
a) They are permits bought by firms where prices are set by governments. b) They will be bought by firms that can reduce pollution only at high costs. c) They will be bought by firms that can reduce pollution at low costs. d) They will be used in reducing pollution when corrective taxes cannot be used.
Which of the following would cause an increase in the market supply of drones?
A) a decrease in the demand for drones B) an increase in taxes levied on drones C) an increase in the cost of components used to make drones D) an increase in the number of firms making drones
Government bonds of different terms have different interest rates.
Answer the following statement true (T) or false (F)