An advantage of pollution taxes that is not offered by command-and-control policies is that:
A. with a pollution tax, zero pollution is produced.
B. a pollution tax decreases the price of the polluting good.
C. with a pollution tax, firms have flexibility in their choice of strategies to use to clean up pollution.
D. a pollution tax decreases the demands for goods that cause pollution.
Answer: C
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The incentive of holding excess reserves is equal to
A) the federal funds rate. B) the interest rate earned on excess reserves. C) the discount rate. D) none of the above.
Drug interdiction, which reduces the supply of drugs, will likely be a less effective policy than educating consumers to reduce their demand for drugs because the drug interdiction policy will lower drug prices and reduce the quantity of drugs demanded
a. True b. False Indicate whether the statement is true or false
Classical economics refers to an era in the history of economic thought that stretched from about
A) 1750 to the early 1900s. B) 1935 to the 1970s. C) 1800 to the mid 1900s. D) 1600 to the mid 1800s.
How much revenue will the government raise each week from the tax?
A. $8 million
B. $10 million
C. $20 million
D. $40 million