Why do firms ignore external costs when they pollute?
What will be an ideal response?
Firms have no incentive to incorporate external costs into their decision making. They do not bear the costs—the costs are external to them—and so these costs have no effect on their profits.
Economics
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Over a given period, economic depreciation is the change in capital equipment's
A) output. B) market value. C) rate of return. D) cost of maintenance.
Economics
The table above shows the balance sheet for Ralph's Bank. If the desired reserve ratio is 15 percent, Ralph's Bank has desired reserves of ________
A) $375 B) $2,500 C) $500 D) $450
Economics