Refer to the information provided in Figure 16.4 below to answer the question(s) that follow.Los Angeles International Airport (LAX) is located next to Playa Del Rey. The noise from air traffic negatively affects individuals living in Playa Del Rey, however, this cost is not considered by airlines or air travelers. The airlines feel they have a right to use the airspace while the individuals living in Playa Del Rey feel they have the right to quiet. The following diagram depicts the marginal costs and marginal benefits associated with air travel.
Figure 16.4Refer to Figure 16.4. Suppose the government assigns property rights to the airlines. No
negotiations occur between the parties. The resulting level of air travel is
A. 0 units.
B. 100 units.
C. 120 units.
D. Indeterminate from the given information.
Answer: C
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The percentage rate of change in the price level is called the
A) Consumer Price Index. B) rate of inflation. C) chain-weighted price index. D) rate of absorption.
Who loses and who gains from the minimum wage?
A) Losers are all workers and gainers are all firms. B) Losers are all firms and gainers are all workers. C) Losers are all firms and some workers, while gainers are other workers. D) Gainers are some firms and all workers, while losers are some firms. E) Gainers are some firms and some workers, while losers are other firms and other workers.
Which of the following will facilitate the enforcement of a cartel?
A) most-favored-customer clauses B) reports of bids on government contracts C) meet the competition or price match D) All of the above
Which of the following is not an example of signaling?
a. An employer calls the references of a potential employee before hiring him or her. b. A boyfriend gives his girlfriend a necklace with her favorite gemstone for Valentine's Day. c. A home flooring company advertises its high Better Business Bureau rating during its television commercials. d. A company advertises that it makes charitable contributions.