Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Textbook Question
Chapter 17, Problem 12RQ
What is a bond?
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Consider the market for electricity. Suppose that a power plant dumps byproducts into a nearby river, creating a negative externality for those living
downstream from the plant. Producing additional electricity imposes a constant per-unit external cost of $490. The following graph shows the demand
(private value) curve and the supply (private cost) curve for electricity.
Use the purple points (diamond symbol) to plot the social cost curve when the external cost is $490 per unit.
PRICE (Dollars per unit of electricity)
1400
1260
1120
980
840
700
560
420
280
140
°
D
1
2
3
D
Supply
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Demand
(Private Value)
5
6
7
QUANTITY (Units of electricity)
Social Cost
The market equilibrium quantity is
units of electricity, but the socially optimal quantity of electricity production is
units.
To create an incentive for the firm to produce the socially optimal quantity of electricity, the government could impose a
unit of electricity.
per
How do mining of raw materials for a tech industry affects the human rights in the world
Assume the Federal Interstate Commission began the fiscal year with the following account balances: FEDERAL
INTERSTATE COMMISSION Trial BalanceOctober 1, 2020 Debits Credits Fund Balance with Treasury$810,000 Supplies
107,000 Equipment 1, 370,000 Accumulated Depreciation $484,000 Accounts Payable 130,000 Wages Payable
85,000Cumulative Results of Operations 1,588,000 $2,287,000 $2,287,000 Congress passed a spending bill
providing $17,200, 000 to fund the agency's operations for the year. During the first quarter the commission processed
the following items for payment (all items were paid by Treasury in the first quarter). Accounts payable$130,000
Wages payable 85,000 Salaries and benefits 507,000 Supplies 524,000 Contracted services 2,200,000 Grants
1,020,000 Equipment 620,000 Total$5,086,000 Unpaid wages at the end of the quarter totaled $37,000. In addition
to the items paid in item 2, the commission received supplies of $24,000 and contracted services of $82,000 that are to
be…
Chapter 17 Solutions
Principles of Economics 2e
Ch. 17 - Answer these three questions about early-stage...Ch. 17 - From a firms point of view, how is a bond similar...Ch. 17 - Calculate the equity each of these people has in...Ch. 17 - Which has a higher average return over time:...Ch. 17 - Investors sometimes fear that a high-risk...Ch. 17 - What is the total amount of interest from a 5,000...Ch. 17 - If you receive 500 in simple interest on a loan...Ch. 17 - You open a 5-year CD for 1,000 that pays 2...Ch. 17 - What are the- most common ways for start-up firms...Ch. 17 - Why can firms not just use their own profits for...
Ch. 17 - Why are banks more willing to lend to...Ch. 17 - What is a bond?Ch. 17 - What does a share of stock represent?Ch. 17 - When do firms receive money from a stock sale in...Ch. 17 - What is a dividend?Ch. 17 - What is a capital gain?Ch. 17 - What is the difference between a private company...Ch. 17 - How do the shareholders who own a company choose...Ch. 17 - Why are banks called financial intermediaries?Ch. 17 - Name several different kinds of bank account. How...Ch. 17 - Why are bonds somewhat risky to buy, even though...Ch. 17 - Why should a financial investor care about...Ch. 17 - What is a mutual fund?Ch. 17 - What is an index fund?Ch. 17 - How is buying a house to live in a type of...Ch. 17 - Why is it hand to forecast future movements in...Ch. 17 - What are the two key choices U.S. citizens need to...Ch. 17 - Is investing in housing always a very safe...Ch. 17 - If you owned a small firm that had become somewhat...Ch. 17 - Explain how a company can fail when the safeguards...Ch. 17 - What are some reasons why the investment strategy...Ch. 17 - Explain why a financial investor in stocks cannot...Ch. 17 - Explain what happens in an economy when the...Ch. 17 - You and your friend have opened an account on...Ch. 17 - How do bank failures cause the economy to go into...Ch. 17 - The Darkroom Windowshade Company has 100,000...Ch. 17 - Imagine that a local water company issued 10,000...Ch. 17 - Suppose Ford Motor Company issues a five year bond...Ch. 17 - How much money do you have to put into a bank...Ch. 17 - Many retirement funds charge an administrative fee...
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- not use aiarrow_forwardConsider the following statements: a. Fewer people are employed in Freedonia now than at any time in the past 75 years. b. The unemployment rate in Freedonia is lower now than it has been in 75 years.Can both of these statements be true at the same time? A. Yes, these statements can be correct if more people are classified as "discouraged workers."B. No, these statements cannot be true since unemployment must increase as employment decreases.C. Yes, if the number of unemployed decreases more than the number of employed.D. Yes, both of these statements can be correct if labor productivity increases.arrow_forwardAsap please and quality answerarrow_forward
- 1) Use the supply and demand schedules to graph the supply and demand functions. Find and show on the graph the equilibrium price and quantity, label it (A). P Q demanded P Q supplied 0 75 0 0 5 65 5 0 10 55 10 0 15 45 15 10 20 35 20 20 25 25 25 30 30 15 30 40 35 40 5 0 35 40 50 60 2) Find graphically and numerically the consumers and producers' surplus 3) The government introduced a tax of 10$, Label the price buyers pay and suppliers receive. Label the new equilibrium for buyers (B) and Sellers (S). How the surpluses have changed? Give the numerical answer and show on the graph. 4) Calculate using midpoint method the elasticity of demand curve from point (A) to (B) and elasticity of the supply curve from point (A) to (C).arrow_forwardFour heirs (A, B, C, and D) must divide fairly an estate consisting of three items — a house, a cabin and a boat — using the method of sealed bids. The players' bids (in dollars) are: In the initial allocation, player D Group of answer choices gets no items and gets $62,500 from the estate. gets the house and pays the estate $122,500. gets the cabin and gets $7,500 from the estate. gets the boat and and gets $55,500 from the estate. none of thesearrow_forwardJack and Jill are getting a divorce. Except for the house, they own very little of value so they agree to divide the house fairly using the method of sealed bids. Jack bids 140,000 and Jill bids 160,000. After all is said and done, the final outcome is Group of answer choices Jill gets the house and pays Jack $80,000. Jill gets the house and pays Jack $75,000. Jill gets the house and pays Jack $70,000. Jill gets the house and pays Jack $65,000. none of thesearrow_forward
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