Which one of the following is not a possible limitation of using the Coase theorem to guide environmental policy?
a. The free rider effect
b. Poor communities are likely to bear a high proportion of environmental costs
c. Voluntary transactions cannot protect the environment
d. Transactions costs are likely to be high when many parties are involved
Answer: c. Voluntary transactions cannot protect the environment
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When the price of apples is $3 per bushel, and the quantity demanded is 1,000 bushels,
A) consumers need 1,000 bushels. B) consumers plan to purchase a total of 1,000 bushels. C) both A and B are true. D) none of the above is true.
The balance of payments has become a central issue for the United States because
A) when the balance of payments is not balanced, society is unbalanced. B) the U.S. economy cannot grow when the balance of payments is in deficit. C) the U.S. has run huge trade deficits in every year since 1982. D) the U.S. never experienced a surplus in its balance of payments. E) the U.S. once ran a large trade surplus of about $40 billion.