Explain why companies that choose low-pollution technologies will find it hard to survive in a competitive industry
In order to survive in a competitive industry, a firm must operate at minimum average cost in the long run. It is unlikely that the lowest cost technology is a low-polluting technology. Typically, it costs more to produce using a low-polluting technology. Hence, the firm that chooses the low-polluting technology will incur costs above minimum average cost, and so will not survive in a competitive industry in the long run.
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One of the provisions of the second stimulus bill increased the amount of investment spending that firms were allowed to depreciate for tax purposes from 50% to 100%
This is just one of over 100 temporary tax provisions affecting firms in the United States. Temporary tax breaks such as the increase in depreciation will tend to A) increase investment expenditures because the tax breaks will entice firms to leave other countries and invest in the United States. B) have little impact on current investment expenditures since the tax breaks are temporary. C) increase investment expenditures in both the short run and the long run, since investment is irreversible. D) increase investment expenditures in the short run but also increase the uncertainty and volatility of investment since the tax breaks are temporary.
The three problems with using the consumer price index as a measure of the cost of living are
a. widely acknowledged and easy to solve. b. widely acknowledged and difficult to solve. c. nearly unacknowledged and easy to solve. d. nearly unacknowledged and difficult to solve.