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The Clean Air Act instituted trades between states for SO2 emissions. Several utility companies across geographic borders have engaged in such trades in recent years. Consider a trade between a utility in Wisconsin and the TVA in Tennessee. Assume that the trade reduces Wisconsin electricity consumers’ bills by a total of $ 1 million, and lowers Tennessee electricity consumers’ bills by $ 500,000. Also assume that the trade improves local environmental quality in Wisconsin by an amount that people value at $ 2 million. If the local environmental quality in Tennessee declines as a result of this trade, then indicate a potential Coase agreement that could avoid the environmental decline and would still make the trade profitable to both parties ? Is such a trade possible in this scenario ?
In your own words, explain the farmer’s optimal solution in the free market using marginal cost analysis. How might this solution be suboptimal from society’s perspective? Explain who benefits and is harmed under the free market solution.
What is the Federal Reserve (Fed) all about? Which Federal Reserve District Bank is closest to you? Who is the current Chairman of the Fed? Should the Fed remain independent from political authority or should the President and Congress have a say in ..
Jim Vendors is viewing about manufacturing a new type of electric razor for men. If advertise were favorable, he would get a return of $100,000.
while a decrease in price of pizzas rotates it rightward. How can we possibly speak systematically about people's preferences.
Explain what causes the shift in the Short-Run tradeoff between inflation and unemployment? Analyze the effects of Tax Cuts, Increasing Government Purchases, and Quantitative Easing using the IS-LM model. Do you believe that all these policies are ef..
Which of the subsequent companies has recently been used by the federal government for monopoly practices
Jay Boville Corporation is being sued by Lark Dent. Lark Dent can settle out of court and win $40,000 or go to court. If Lark goes to court, there is a 30% chance that she will win the case. If she wins, a small and a large settlement are equally lik..
A perfectly competitive firm faces a:
Why did the budget surpluses in 2000 and 2001 give way to a series of budget deficits beginning in 2002? Why did those deficits increase substantially beginning in 2008?
Assume that in a small open economy with full employment, consumption depends only on disposable income. National saving is 300, investment is given by I = 400 - 20r, where r is the real interest rate in percent, and the world interest rate is 10 per..
Social Security has revenues of $1.8 trillion and expenditures of $1.3 trillion. The nonsocial Security budget has revenue of $2.1 trillion and expenditures of $2.4 trillion. The official budget will report a _______________ (deficit/surplus) of $___..
Suppose that the demand in a particular industry is given by Qd = 500 − 2P. When the market price in the industry is $50 per unit, total demand in the industry is _________. Furthermore, assume that the entire market consists of four firms that share..
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