Suppose a paper mill earns $1,000,000 in profits when it pollutes a river, and it can abate pollution at a cost of $A. The effects of the pollution are confined to a single farmer who earns $400,000 if the water he uses from the river is clean and $300,000 if it's polluted. Which of the following expressions gives the combined profit of both firms with abatement?
A. $(1,300,000 - A)
B. $(1,400,000 - A)
C. $(700,000 + A)
D. $(1,700,000 - A)
B. $(1,400,000 - A)
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Assuming the United States is the "domestic" country, if the real exchange rate between the United States and Russia decreases from 28 to 23,
A) the prices of U.S. goods and services have increased by 22% relative to Russia. B) the prices of U.S. goods and services have decreased by 5% relative to Russia. C) the prices of U.S. goods and services have increased by 25.5% relative to Russia. D) the prices of U.S. goods and services have decreased by 18% relative to Russia.
The Phillips Curve shows the trade-off between
a. unemployment and output b. inflation and output c. rates of unemployment and inflation d. imports and exports e. unemployment and inflation
For any given change in taxes, the multiplier
a. will work indirectly through consumption. b. effect will occur in two steps. c. effect will be smaller than for an equivalent dollar change in government spending. d. All of the above are correct.
In calculating the unemployment rate, part-time workers are:
A. included in the labor force but not the unemployment rate. B. counted as unemployed because they are not working full time. C. counted as employed because they are receiving payment for work. D. excluded from the labor force because they are not actively seeking employment.