Which of the following statements is true?
A. Firms are unlikely to relocate their high-pollution production to countries with lax environmental laws because they fear that such moves will result in adverse effects on their reputations.
B. Evidence shows that measures to keep the environment clean represent a large percentage of the total costs of production for a firm in a country with strict environmental laws.
C. There are large incentives for firms to relocate from countries with strict environmental laws to countries with lax environmental regulation.
D. Imposition of a tax on the production of a particular high-pollution product typically has a greater impact on consumer surplus than on producer surplus.
Answer: A
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a. the cost of investing in diversified assets. b. the cost of finding a trading partner. c. the cost of devising and enforcing an agreement. d. the cost of evaluating the other party's performance.
The amount of reserves that a commercial bank is required to hold is equal to:
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