If the Fed orders an expansionary monetary policy, describe what will happen to the following variables relative to what would have happened without the policy:

Consider a factory that emits chemicals into a river, thus polluting the water supply of a downstream community. The Coase Theorem states that the socially optimal, or efficient, solution can be achieved by assigning property rights to _____________________.

a. the company. b. the community. c. the company and the community, jointly. d. the company or the community. e. a government regulator.

In the long run, a year-long drought that destroys most of the summer's wheat crops causes permanently:

A. higher prices. B. lower prices. C. lower output. D. None of these is true.