An optimal tax on pollution would result in which of the following?
a. Producers will choose not to produce any pollution.
b. Producers will internalize the cost of the pollution.
c. Producers will maximize production.
d. The value to consumers at market equilibrium will exceed the social cost of production.
b
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The formal and informal rules governing the organization of a society on the whole, including its laws and regulations, are referred to as:
A) organizational structure. B) religious norms. C) cultural scenario. D) institutions.
If the painting firms in a city sign a contract outlining a pricing plan, they are involved in
A) price regulation. B) collusion. C) price competition. D) a legal form of business contract in the United States.
Suppose that the firm's only variable input is labor. When 50 workers are used, the average product of labor is 50 and the marginal product of labor is 75. The wage rate is $80 and the total cost of the fixed input is $500. Suppose that installation of a new assembly line increases the output produced per worker. The cost per unit of output
A. will increase. B. will be unchanged. C. will decrease. D. is at its maximum. E. is at its minimum
To be a natural monopoly, a firm must
A) control a key resource input. B) have economies of scale that are so large that it can supply the entire market at a lower cost than two or more firms. C) have significant network externalities. D) be in a government-regulated market.