The efficient congestion tax is zero when:
A. everyone can travel safely at the posted speed limit.
B. there are no other cars on the road.
C. there are no traffic accidents on a stretch of highway.
D. carpool lanes are available.
Answer: A
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In the simple deposit expansion model, if the Fed purchases $100 worth of bonds from a bank that previously had no excess reserves, deposits in the banking system can potentially increase by
A) $10. B) $100. C) $100 times the reciprocal of the required reserve ratio. D) $100 times the required reserve ratio.
A firm operating in a purely competitive resource market faces a resource supply curve that is:
A. perfectly inelastic. B. perfectly elastic. C. highly inelastic. D. highly elastic.
The marginal cost curve intersects the average variable cost curve at the ________ value of the average variable cost curve.
A. average B. minimum C. zero D. maximum
Which of the following help to correct for the market failure of imperfect information?
A. used car warranties B. medical licensing C. truth-in-advertising regulations D. All of the above are correct.