Answer the following statement(s) true (T) or false (F)
1. According to the cost-effectiveness criterion, all polluting sources would abate pollution up to the point where their individual abatement levels were equal.
2. According to the cost-effective abatement criterion, all polluting sources would abate pollution up to the point where their individual total abatement cost (TAC) levels were equal.
3. If the MACs for firm 1 and 2 are: MAC1 = 0.4A1 and MAC2 = 0.8A2, respectively, and the combined abatement standard is 15 units, then the cost-effective abatement levels are 10 units for firm 1 and 5 units for firm 2.
4. Suppose the combined abatement standard is set at 22 units and firm J and firm K have MAC functions of MACJ = 0.5A, and MACK = 0.75A, respectively. If firm J is abating 10 units and firm K is abating 12 units, firm K should abate more units and firm J should abate less.
1. False
2. False
3. True
4. True
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An important difference between offering prospectus in a public bond issue and the offering memorandum in a private placement is
A) all relevant factual information about the firm and its financing is required in the prospectus but not in the offering memorandum. B) evidence of due diligence is required in the offering memorandum but not in the prospectus. C) the prospectus may not contain any projections about the company's future while an offering memorandum has no such restriction. D) There are no differences between these two documents.
Market economies produce outcomes that
a. are virtually ideal in all respects. b. are inferior to most other systems. c. are, in some respects, far from ideal. d. are virtually indistinguishable from command economies.
The goal of the manager of a firm is sales maximization. The firm will produce
a. the output level at which MR = 0. b. as much output as it can. c. the same output that it would if the goal was profit maximization. d. the same output that it would if the goal was cost minimization.
This Marketing the Connection argues that a key difference between market economies and centrally planned economies, like the former Soviet Union, is that "In market economies, decisions about which investments to make and which technologies to adopt are made by entrepreneurs and managers with their own money on the line. In the Soviet system, these decisions were usually made by salaried bureaucrats trying to fulfill a plan formulated in Moscow." But in large corporations, investment decisions are often made by salaried managers who do not, in fact, have their own money on the line. These managers are spending the money of the firm's shareholders rather than their own money. The investment decisions of salaried managers int he United States tend to be better for the long-term growth of
the economy than were the decisions of salaried bureaucrats in the Soviet Union because: A. Soviet managers feared losing their jobs if they adopted new technologies B. U.S. managers are driven by incentives of higher profits, leading them to adopt new technologies C. U.S. managers face no competition from domestic and foreign firms D. Soviet bureaucrats concentrated on cutting costs as they faced intense competition from home and abroad