A system of tradable air pollution permits has the advantage of
A. eliminating all environmental liability for participating polluters.
B. ensuring that the goal amount of abatement occurs at the lowest social cost.
C. rewarding efficient abatement effort at the expense of inefficient abatement efforts.
D. reducing the total amount of air pollution.
Answer: B
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The figure above shows the labor market in a small town. If the government imposes a wage of $10 that firms must at least pay,
A) the government has imposed a minimum wage and market forces are not allowed to work. B) inflation will occur as wages rise. C) job search will decrease. D) the government has imposed an efficiency wage. E) job rationing will decrease.
Antitrust laws in the United States
A) are an attempt to foster competition. B) are not necessary in the twenty-first century. C) have not been used in the past twenty-five years. D) are the same as the laws in the European Union.
Which of the following statements is not correct?
a. The government may use antitrust laws to break up an existing company to improve competition. b. The government may break up a natural monopoly to lower the price charged to customers. c. Private ownership is typically preferred to public ownership. d. Sometimes the best strategy is for the government to do nothing about monopoly inefficiency because the "fix" may be worse than the problem.
A fundamental principle of international trade is that
A. a country could never have lower resource costs than other countries in the production of ALL goods and services. B. a country could never have lower opportunity costs than other countries in the production of ALL goods and services. C. two nations could both have a comparative advantage over each other in production of the same good. D. the world gains from trade because trade allows production of goods and services to move to nations with the lowest resource cost.