Suppose that a steel factory emits a certain amount of air pollution, which constitutes a negative externality. If the market does not internalize the externality,
a. the supply curve would adequately reflect the marginal social cost of production.
b. consumers will be required to pay a higher price for steel than they would have if the externality were internalized.
c. the market equilibrium quantity will not be the socially optimal quantity.
d. producers will produce less steel than they otherwise would if the externality were internalized.
c
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What is collective bargaining? How can it result in higher unemployment in a country?
What will be an ideal response?
The above figure shows the market for blouses. The government decides to impose the sales tax on sellers, as shown in the figure. The government would raise more tax revenue from this excise tax if
A) the demand was more inelastic. B) it places a price ceiling on blouses in addition to the tax. C) it places a price floor on blouses in addition to the tax. D) all of the above.
The price elasticity of gasoline supply in the U.S. is 0.4. If the price of gasoline rises by 8%, what is the expected change in the quantity of gasoline supplied in the U.S.?
A) +3.2% B) -3.2% C) +32.0% D) +0.32%
Which of the following is true of the FDIC?
a. It controls the operations of all commercial banks in the U.S. b. It exists only in the countries of North America and Europe. c. It covers depositors against losses up to $500,000 in a bank account. d. It is a federal agency that insures bank deposits in commercial banks. e. It is a financial institution that uses cost-plus pricing.