Output regulation for the natural monopoly in Figure 27.2 would result in an output of
A. QB only.
B. QA or QB, but not QC.
C. QA only.
D. QC.
Answer: B
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Explain how a pollution tax is different from a Pigouvian tax. Discuss how incentives for firms differ under the two types of taxes, and what would be required of the government if it were to structure a Pigouvian tax system to mimic the effects of a pollution tax.
What will be an ideal response?
The Lost Decade refers to the years between approximately
A) 1975 and 1985. B) 1980 and 1990. C) 1987 and 1997. D) 1972 and 1980. E) 1960 and 1970.
To determine whether an increase in the price of gasoline results in a consumer spending a larger share of their expenditure on gasoline we need to know
A) only how much money the consumer spends on gasoline before the price change B) only the change in the price of gasoline C) only the change in the price of gasoline as a percentage of the original price D) only the own price elasticity of demand for gasoline E) none of the above
Which one of the following is an example of a positive statement?
A. The federal government should provide economic assistance to farmers. B. The amount of financial assistance given to farmers is higher this year than it was 10 years ago. C. State governments should provide economic assistance to farmers. D. Farmers need some type of government aid.