Answer the following statement(s) true (T) or false (F)
1. The sum of all polluters’ MACs equals the marginal social cost (MSC) of abatement.
2. Much of the air pollution in Catano, Puerto Rico was linked to a nearby oil refinery.
3. By definition, the marginal abatement cost (MAC) curve shows the change in costs associated with higher levels of abatement, using the most widely available technology.
4. The marginal cost of enforcement (MCE) must be added vertically to the MACmkt to derive the marginal social cost (MSC) of abatement function.
5. If a standard is set to balance the well-being of society with the associated costs, it is called a benefit-based standard.
1. False
2. False
3. False
4. True
5. False
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Net interest payments made by the government depend on the total federal debt held and on the level of interest rates
Indicate whether the statement is true or false
In the classical model, fiscal policy has no demand-side effects on output or employment
a. True b. False