An effluent fee is an example of
A. a government policy to promote the production of a product with an external benefit.
B. a government policy to correct for an external cost.
C. a government policy to promote the production of a product with an external cost.
D. a government policy to correct for an external benefit.
Answer: B
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A world price of a good:
A) is the lowest price for which the good is available in any country in the world. B) is the price prevailing in the country with the highest production of the good. C) is equal to the lowest opportunity cost of producing the good in any country in the world. D) is the prevailing price of the good on the global market.
In a large open economy like the United States, an increased government budget deficit which reduces national saving
A) reduces investment and improves the current account balance. B) reduces investment and reduces the current account balance. C) has no effect on investment, but reduces the current account balance. D) has no effect on either investment or the current account balance.
The Federal Reserve System performs the following functions, except:
A. Issuing the paper currency in the economy B. Providing banking services to the general public C. Providing financial services to the Federal government D. Lending money to banks and thrifts
The cross-price elasticity of demand is the percentage change in the quantity of good A that is demanded as a result of a percentage change in the price of good B.
Select whether the statement is true or false. A. True B. False