Suppose a chemical plant regularly dumps chemicals into a river that must be cleaned up before farmers located downstream can use the water on their crops
Dumping the chemicals into the river saves the chemical plant $750,000 in yearly disposal costs and cleaning the water costs farmers $825,000 each year. Explain what the benevolent social planner would like to see happen in this case.
Since the cost to clean the water is greater than the cost of disposing the chemicals in a way other than dumping them into the river, the benevolent social planner would like to see the chemical plant not dump the chemicals in the river.
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Refer to Table 9-11. With trade, what is the total gain in hat production?
A) 150 B) 300 C) 400 D) 650
An economist might argue that U.S. national defense should be funded through tax revenues because: a. U.S. citizens are not very patriotic
b. the government is always a more efficient provider of goods than the private market. c. the government always seeks to act benevolently on behalf of its citizens. d. individuals who refuse to contribute to a national defense fund cannot be excluded from benefiting from national defense.