Explain some important situations where direct controls have a clear advantage over taxes
1 . Where an emission is so dangerous that it must be prohibited altogether.
2 . Where a sudden change in circumstances calls for prompt and substantial changes
3 . Where effective and dependable pollution-metering devices have not been invented or are prohibitively costly to install and operate.
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Which of the following characterizes the largest difference between the way decisions are made in the private sector versus the public sector?
A) The incentive system for individuals to perform efficiently are vastly different. B) The workers themselves are really quite different types of people. C) In both sectors individuals will try to maximize their own individual gains over the gains of others. D) Costs and resources are vastly different in each sector.
The primary source of scale diseconomies appears to be:
a. a firm's inability to acquire quality resources. b. too little demand for the firm's product. c. consumers who resist dealing with large firms. d. division of labor. e. the organizational difficulties of managing an ever larger enterprise.
Which of the following is a common criticism of advertising?
a. It manipulates consumers’ tastes. b. It emphasizes product quality. c. It creates competition between firms. d. It focuses on what consumers want.
Which fact about the term structure is the expectations theory unable to explain?
A. Why interest rates on bonds with different terms to maturity tend to move together over time. B. Why longer-term yields tend to be higher than shorter-term yields. C. Why yields on short-term bonds are more volatile than yields on long-term bonds. D. Why long-term bond yields are influenced by expected future short-term bond yields.