From an economic standpoint, the amount of pollution should be
A. the amount that allows firms to maximize profits.
B. zero.
C. the amount where firms are earning a normal rate of return on investment.
D. at the point at which the marginal benefit from further reduction equals the marginal cost of further reduction.
Answer: D
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On the modern Phillips curve, the beginning of a recession is shown by ________
A) an upward movement along the Phillips curve to a higher inflation rate B) an upward shift of the Phillips curve leading to higher inflation rates for any unemployment rate C) a downward shift of the Phillips curve leading to lower inflation rates for any unemployment rate D) a downward movement along the Phillips curve to higher unemployment rates E) none of the above
A price ceiling will be binding only if it is set a. equal to the equilibrium price
b. above the equilibrium price. c. below the equilibrium price. d. either above or below the equilibrium price.