Suppose chicken farm waste flowed into a river used by a neighbor for drinking water. The results of the Coase theorem s are relevant when the legal rights to the river are given to:
a. the chicken farm.
b. the neighbor.
c. either the chicken farm or the neighbor.
d. neither the chicken farm nor the neighbor
Ans: c. either the chicken farm or the neighbor.
Economics
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Which of the following statements applies to economics, as well as to other sciences such as physics?
a. Experiments are considered valid only when they are conducted in a laboratory. b. Good theories do not need to be tested. c. Real-world observations often lead to theories. d. Economics, as well as other sciences, is concerned primarily with abstract concepts.
Economics
If demand is perfectly inelastic, the absolute value of the price elasticity of demand is
A) zero. B) less than one. C) more than one. D) equal to the absolute value of the slope of the demand curve.
Economics