Taxes on a producing firm's spillovers
A. are designed primarily as a way to raise money so that the government can compensate the victims of the externality.
B. are simply meant to force decision makers to consider the full costs of their actions.
C. will lead to a zero level of output.
D. are designed to make it easier for economists to measure spillovers.
Answer: B
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The marginal revenue for a single-price monopoly with a downward-sloping demand curve
A) is less than the price.
B) is greater than the price.
C) is equal to the price.
D) might be more than, less than, or equal to the price, depending on whether the slope of the demand curve exceeds 1.0 in magnitude.
E) might be more than, less than, or equal to the price, depending on whether the price elasticity of demand exceeds 1.0 in magnitude.
Fine-tuning involves the adoption of fixed policy rules regardless of the economic situation.
Answer the following statement true (T) or false (F)
The theory of public choice
A. Explains the selfless pursuit of public goals by public servants. B. Examines why the public rejects so many bond referendums. C. Examines how a policy of laissez faire works to allocate resources. D. Emphasizes the self-interest of decision makers and voters.
In the long run, the price of information products in monopolistically competitive markets will be equal to
A) zero. B) MC. C) AFC. D) ATC.