A corrective tax
a. allocates pollution to those factories that face the highest cost of reducing it.
b. is a form of regulation.
c. works well for all types of externalities.
d. is inferior to regulatory policy according to most economists.
a
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To economists, scarcity means that
A) the number of people without jobs rises when economic times are bad. B) unlimited wants cannot be satisfied by the limited resources. C) limited wants cannot be satisfied by the unlimited resources. D) there can never be answers to the what, how or for whom questions. E) a person looking for work is not able to find work.
Assume the economy is operating at a real GDP above full-employment real GDP. Classical economists would prescribe which of the following policies?
a. Nonintervention b. Active monetary policy c. Contractionary d. Expansionary