Taxes can be justified if the government uses the revenue to (i) provide public goods such as national defense. (ii) clean up negative externalities such as water pollution. (iii) regulate a common resource such as fish in a public lake. (iv) provide goods with positive externalities such as medical research

Which of the following will NOT be true if the antitrust laws are successful?

A) Producers will earn zero economic profits in the long-run. B) Firms will not restrict output. C) Firms will produce the competitive output. D) Firms will produce the quantity at which marginal cost equals marginal revenue and charge a price that is greater than marginal cost.

The buying and selling of foreign currency by the central bank is a trade policy whose objective is:

A. reducing purchases of assets abroad. B. stabilizing the exchange rate against external shocks. C. stabilizing the interest rate against foreign capital outflows. D. promoting long term economic growth.