A change in which of the following will have a direct effect on the amount of money individuals wish to hold in the current period?

If a product becomes more popular and consumers want more produced, which of the following best describes what happens to move more factors of production into that industry?

A) An agency of the Federal government directs the movement of factors. B) The chief executive officers or presidents of corporations require that factors leave one industry and move to the other industry. C) Factor owners voluntarily move their factors because they want to satisfy the interests of consumers. D) Wages, rent, interest, and profit increase in that industry, thereby giving factors the incentive to move to that industry. E) Consumers increase their demand for the products and, as a result, the taxes the producers must pay decrease enabling the producers to hire more factors of production.

The above figure shows the market for steel ingots. If the market is competitive, then to achieve the socially optimal level of pollution, the government can

A) outlaw the production of steel. B) institute a specific tax of $25. C) institute a specific tax of $50. D) institute a specific tax equal to area b.