Help
Options
Didn't know it?
click below
click below
Knew it?
click below
click below
Don't Know
Remaining cards (0)
Know
retry
shuffle
restart
0:00
Embed Code - If you would like this activity on your web page, copy the script below and paste it into your web page.
Normal Size Small Size show me how
Normal Size Small Size show me how
Econ Chapter 9 &10
| Question | Answer |
|---|---|
| A market economy will produce _______ without any government regulation. | too much pollution |
| The socially optimal amount of pollution occurs when | The marginal social benefit of pollution is equal to the marginal social cost of pollution |
| The marginal social benefit of pollution | can be measured as the additional gain to society from one additional unit of pollution. |
| Pollution has ______ and _______. | Benefits, Costs |
| The efficient level of pollution is when. | the quantity at which its total benefits exceed its total costs by the greatest possible amount. |
| A negative externality: | is an uncompensated cost imposed by an individual or firm on others. |
| An externality is said to exist when | Individuals impose costs or benefits on others but have no incentive to take theres costs and benefits to account. |
| If external costs exist, the competitive free market will: | allocate resources inefficiently |
| An externality is said to be internalized | when individuals take external costs and benefits into account in their decision making |
| According to the Coase Theorem, a market will _______ when negative externalities are present. | Reach an efficient solution if transaction costs are low |
| According to many economists, the government should | use its policies to achieve the least-cost way of reducing the level of emissions. |
| The principal government agency in the US responsible for enforcing national environmental policies is the | Environmental Protection Agency |
| Laws that require vehicles to have catalytic converters or that restrict or prohibit leaf burning are both examples of | Policies toward pollution |
| Tradable pollution permits are an | organized exchange of licenses that enable the holder to pollute up to a specified amount during a given period |
| Taxes are a more effective method of controlling pollution than environmental standards because | Taxes encourage reducing pollution at minimum cost |
| An external benefit is | Benefit that individuals or firms confer on others without receiving compensation |
| A Pigouvian subsidy is | designed to encourage activities generating eternal benefits |
| A ______ Is excludable and rival in consumption | Private good |
| A good is most likely to be artificially scarce if | It is excludable but nonrival |
| TV is nonrival because | More than one person can consume the same unit of the good at the same time |
| A private good is | Excludable and rival in consumption |
| The free-rider problem is a direct result of | the inability to exclude nonpayers |
| An ineffeicient allocation of resources will occur when | decision makers are not faced with the full benefits and costs of their actions |
| Common resources tend to be ______ through private markets | over consumed |
| Topics studied in macroeconomics include | Inflation, unemployment, and economic growth |
| Macroeconomics is the study of the | Overall behavior of an economy |
| Changing the level of government spending is an example of | Fiscal Policy |
| The modern tools of macroeconomic policy are | Fiscal and monetary policy |
| Monetary policy attempts to affect the overall level of spending in the economy by making changes in | Interest rates |
| Fiscal policy attempts to affect the overall level of spending in the economy through | changes in tax policy or government spending |
| Fiscal policy involves change in | government spending |
| Periods in which output and employment are falling are known as | recession |
| An expansion is a period which | Outputs rise |
| The short-run alteration between economic downturns and recessions, then economic upturns and expansions is known as the | business cylce |
| The point in the business cycle at which a recession ends and the expansion begins is called the | trough |
| The sequence of business cycle phases are | Peak, Recession, trough, Expansion |
| Long-run growth is | the sustained upward trend in the economy's output over time |
| Long-run growth per capita is | a sustained upward trend in the economy's overall output per person |
| Inflation | is an increase in the overall level of prices |
| If a country has a trade deficit, does it indicate that the country has a serious problem? | No. Trade deficits occur when a country's investment spending is higher than its level of saving |
| An open economy is an economy that | Trades goods and services with other countries |
| The paradox of thrift highlights: | How individual decisions to save more may worsen a recession |
| An overall decrease in the price level is called | Deflation |
| A trade surplus occurs | When the value of goods and services a country imports is less than the value of goods and services it exports |
| If a country runs a trade deficit, its investment spending is probably | Greater than its level of savings |
Created by:
100003547848196