When a polluter has to bear the full social cost of their actions, they will
A) weigh the costs and benefits of each potential action and might decide to not stop polluting by paying a fine.
B) go out of business since pollution abatement is expensive.
C) will always decide to reduce the amount of pollution by reducing the quantity they produce.
D) increase the price of the product and the quantity produced to pay for the additional costs.
A
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For a product with external benefits that is produced in a competitive, unregulated market, how can the resulting market output be described?
A) underproduction compared to the efficient level B) overproduction compared to the efficient level C) production equals the efficient level D) Underproduction or overproduction are both possible depending on whether the external benefit is to consumption or production. E) None of the above is correct.
Which one of the following are the components of aggregate expenditure?
a. household consumption, business investment, government spending for goods and services, and net exports b. household consumption, business investment, government transfer payments, and net exports c. household consumption, business investment, government spending for goods and services, and exports d. household consumption, business investment, government spending for goods and services, and saving e. household consumption, business inventories, government spending for goods and services, and net exports
Price discrimination refers to
A. selling a product at different prices, with the price difference being unrelated to differences in marginal cost. B. selling a product at different prices according to the differences in marginal cost of providing it to different consumers. C. charging the same prices to all consumers but selling them different quantities. D. a deliberate effort on the part of a monopoly producer to confuse consumers.
A country's demand for foreign currency is derived from
A. the government's attempt to revalue domestic currency. B. international transactions entering the debit side of its balance-of-payments accounts. C. international transactions entering the credit column of its balance-of-payments accounts. D. an increase in foreign capital inflows into the domestic country.