In some parts of the United States, sugar beets are grown and harvested. The process of producing usable sugar from the beets generates foul-smelling smoke. A government policy that limits the emission of smoke by sugar-beet-processing firms is an example of
a. a market-based policy.
b. a command-and-control policy.
c. tradable pollution permits.
d. transaction costs.
b
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A risk averse individual
a. values a lottery at more than its expected value b. values a lottery at exactly its expected value c. values a lottery at less than its expected value d. tends to play lots of lotteries
Which of the following examples best illustrates a negative network externality?
a. Jamal goes to the theme park on weekdays to avoid the crowds. b. Jamal buys his plane ticket on sale to avoid an expected rate increase. c. Jamal goes to a movie instead of a concert because concert ticket prices increase. d. Jamal buys a season pass to the theme park to save money.
Use the above figure. If this monopolist was not regulated, the profit-maximizing quantity and price would be
A. Q3 and P2. B. Q2 and P1. C. Q4 and P1. D. Q2 and P3.
Suppose the required reserve ratio is 20 percent. If banks are conservative and choose not to loan all of their excess reserves, the real-world deposit multiplier is
A) less than 5. B) equal to 5. C) greater than 5. D) equal to 20.