A regional lobster management board recently proposed a five-year moratorium on lobster fishing in the Atlantic waters south of Cape Cod based on a study of the lobster population. Which of the following statements is not correct?
a. Lobsters are rival but not excludable.
b. The lobster population is an example of the tragedy of the commons.
c. Reducing the quota on the number of lobsters any fisher can catch would have a protective effect on the lobster population.
d. If left unregulated, the lobster population will likely increase.
d
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In a cartel, participating members can cheat by
A) letting more entrants join the cartel. B) leaving the industry. C) producing a lower production level than the cartel quota. D) charging a slightly lower price and raising production.
Suppose the velocity of money is 8, the amount of money in circulation is $200 billion, the index of prices is 150, and real GDP is $10 billion. According to the strict quantity theory of money, if the money supply doubled to $400 billion,
a. the velocity of money would fall to 4. b. the index of prices would increase to 300. c. real GDP would increase to $20 billion. d. the velocity of money would rise to 16.
Average total cost is very high when a small amount of output is produced because
a. average variable cost is high. b. average fixed cost is high. c. marginal cost is high. d. marginal product is high.
The exchange rate is the price of
A. An import purchased at the local electronics store. B. An export purchased in a foreign nation. C. One good in terms of another. D. One currency in terms of another.