As long as two firms have different abatement costs, they:
A. can benefit under a system of marketable pollution permits by trading the right to pollute.
B. will prefer a pollution tax to a system of marketable pollution permits.
C. will decrease the price of their product if taxed on the amount of pollution they emit.
D. will not be able to benefit from trading the right to pollute under a system of marketable pollution permits.
Answer: A
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Refer to Figure 14.2. The substitution effect of the wage decrease on the amount of hours of leisure is:
A) L1 to L0. B) L0 to L1. C) L1 to L2. D) L2 to L0. E) none of the above
In the above figure, if this natural monopolist were unregulated, the profit maximizing firm would sell the product at the price
A) A. B) B. C) C. D) F.
A change in consumers' expectations about the future will shift both the aggregate expenditure curve and the aggregate demand curve
a. True b. False Indicate whether the statement is true or false
The basic idea behind the multiplier is that an increase in
a. GDP brings about an additional, larger increase in GDP. b. consumer spending causes a larger increase in investment spending. c. government spending causes a larger increase in tax revenues. d. spending will cause an even larger increase in equilibrium GDP.