Suppose manufacturing of paper results in substantial ground-water pollution. One possible policy that can be used to reduce the inefficiency caused by this externality is
A. to subsidize the production of paper by the domestic firms.
B. to impose a tax on the production of paper.
C. to provide tax benefits to the firms exporting paper.
D. to raise tariff barriers on paper imports.
Answer: B
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Miniville is an isolated town located on the southern shore of Lake Condescending, a very large lake. The western edge of Miniville is adjacent to impassable mountains and there are no towns or businesses for many miles to the east. The 300 residents of Miniville are evenly distributed along 3 miles of shoreline on the lake, east of the mountains. Lake Shore Drive, the only street in town, provides access to Miniville's homes and businesses. All residents live between the lake and the street; businesses locate on the other side of the street. Lake Shore Drive is 3 miles long, and the points labeled A, B, and C are 1, 2, and 3 miles from the western end of Lake Shore Drive, respectively. All residents of Miniville shop at the store located closest to their homes. src="https://sciemce.com/media/4/ppg__rrr0818190951__f1q362g1.jpg" alt="" style="vertical-align: 0.0px;" height="117" width="538" />If one store is located at A and the other store is located at C:
A. 100 people will certainly shop at each store, but where the other 100 will shop is indeterminant.
B. 100 people will shop at the store at A, and 200 people will shop at the store at C.
C. 200 people will shop at the store at A, and 100 people will shop at the store at C.
D. 150 people will shop at each store.
Refer to the scenario above. Which of the following is true if the car dealer has a reputation of trustworthiness?
A) The equilibrium outcome is equitable. B) There is no unique equilibrium. C) There are multiple equilibria. D) The equilibrium is socially efficient.
Suppose that Venezuela experiences significant capital outflows after a recent election. If the nation had fixed exchange rates, these flows would have had the following effect on the reserves account and monetary base
a. Reserves account would rise and monetary base would fall. b. Reserves account would not change and monetary base would fall. c. Reserves account would fall and monetary base would not change. d. Reserves account would fall and monetary base would fall. e. Reserves account would fall and monetary base would rise.
Toyota has been successful in Europe by exporting cars to Europe as well as designing and manufacturing cars in Europe for the European market.
a. true b. false