Which of the following is NOT a possible resolution of externalities?
a. Coasian bargaining
b. regulatory directives
c. taxes and subsidies
d. cap and trade
e. all of the above are possible resolutions of externalities
e
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If a bottle of fine French wine costs US$250 in the U.S., 2500 rand in South Africa, there are no transaction costs, and the exchange rate is 10 rand/US$, then
A) there is an arbitrage opportunity by buying the wine in the U.S., and selling it in South Africa and the price in South Africa will drop. B) there is an arbitrage opportunity by buying the wine in the U.S., and selling it in South Africa and the price in the U.S. will drop. C) there is no arbitrage opportunity. D) Unable to determine, since France is in the eurozone and we would need exchange rates in euro terms.
In the IO perspective, it is important to enter an industry with
a. High barriers to entry b. High buyer power c. High supplier power d. All of the above
TV crime shows illustrate the prisoner's dilemma when the:
A. police interview suspects in the same room. B. police interview suspects in different rooms. C. judge ponders the sentence for the crimes. D. prisoners go to prison for the first time.
Keynesian analysis stresses that a tax cut that increases the government's budget deficit or reduces its budget surplus:
A. is appropriate during a period of inflation. B. will increase the money supply. C. will stimulate aggregate supply and, thereby, promote employment. D. will stimulate aggregate demand and, thereby, promote employment.