When CSU sophomore Cody Clow and his housemates chose not to heed the city's ordinance against unreasonable noise and host a loud party at their off-campus residence last fall, they were confronted and ticketed by police
Fort Collins city code describes unreasonable noise as any sound that will "unreasonably interfere with the enjoyment of life or property." What is TRUE about this situation? A) Marginal external costs are positive.
B) Marginal external costs are negative.
C) Marginal external benefits are positive.
D) Marginal external benefits are negative.
A
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A bank can safely lend an amount equal to its
A) excess reserves. B) required reserves. C) vault cash. D) total reserves.
A few years ago, the city of Seattle, Washington, considered imposing a specific tax on all espresso-based coffee drinks sold in the city. The extra tax revenue generated would have been used to fund after-school programs for low-income children
The coffee-house owners (firms) agreed that this would be a good program to fund, but they argued that the tax would sharply reduce their sales volume and they would pay most of the tax burden. This claim is true if: A) the demand for espresso-based coffee is more inelastic than supply. B) the demand for espresso-based coffee is more elastic than supply. C) there are no close substitutes for espresso-based coffee drinks. D) espresso-based coffee drinks can be produced at constant marginal cost.
A market in which a price-controlled good is sold at an illegally high price is known as
A) a flooring market. B) a ceiling market. C) a black market. D) a supermarket.
Suppose the market demand for milk is Qd = 150 - 5P. Additionally, suppose that a dairy's variable costs are VC = 2Q2 (where Q is the number of gallons of milk produced each day), its marginal cost is MC = 4Q and there is an avoidable fixed cost of $50 per day. In the long run there is free entry into the market. Suppose the demand for milk doubles. What is the new long-run equilibrium quantity?
A. 50 B. 60 C. 100 D. 120