Economies of scale and Increasing Returns to Scale are the same thing looked at from either the production or cost perspective
Indicate whether the statement is true or false
False. Increasing returns to scale imply economies of scale but the reverse is not true. A firm can experience economies of scale for other reasons (without increasing returns to scale)
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Which one of the following statements is false?
a. A Pigouvian tax is used to internalize pollution costs b. Transactions costs could reduce the potential for parties in a dispute to reach an efficient agreement c. The assignment of initial property rights affects the equity of a situation d. The "optimal" level of pollution is unlikely to be zero e. The "optimal" level of pollution maximizes industry profits
Imperfect information means which of the following?
a. one party to the transaction has more information than the other party b. buyers and sellers have all the information necessary to make an informed decision c. buyers and sellers do not have all the information necessary to make an informed decision d. buyers always have more information than sellers to make an informed decision