In some industries, pollution rights are sold from one company that does not need them to another that does. In recent years, conservation groups have purchased pollution rights so they cannot be exercised. Companies in need of pollution rights will find that:
A. the supply of pollution rights has increased.
B. the relative costs of pollution control equipment have gone up.
C. the relative costs of pollution control equipment have fallen.
D. the prices of pollution rights have fallen.
Answer: C
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If the utilization rates of capital and labor are procyclical, then
A) output will rise in recessions and decline in expansions. B) measured productivity will be constant. C) the Solow residual will be procyclical. D) prices will be countercyclical.
What is a period of economic growth as measured by a rise in real GDP called?
(A) An expansion (B) A contraction (C) A peak (D) A business cycle
Recall the Application about how the effect of a more dangerous job on wages may be used to calculate the value of a statistical life to answer the following question(s).According to the Application, one way to calculate the value of a statistical life is to compare how much more workers are paid with:
A. the increase in the probability of dying on the job. B. the average age of death for people who worked in that type of job. C. the number of people how died in that job that year. D. how much the company pays for life insurance for their workers.
In general, a firm will be unlikely to invest as long as the
A. firm has to borrow any money to make the investment. B. profits realized from the investment are insufficient to cover the interest payments. C. interest rate is greater than the inflation rate. D. firm cannot sell bonds directly to the public and instead must borrow from a bank.