A. there are no transaction costs.
B. each affected party has equal power in the negotiations.
C. the party affected by the externality has the initial property right to be left alone.
D. There are a large number of affected parties.

A. the regulators decide how much each polluter should reduce its pollution.
B. no pollution of the environment is tolerated
C. each polluter reduces its pollution an equal amount
D. the polluters with the lowest cost of reducing pollution reduce their pollution the greatest amount

A. the impact of oil prices on car production
B. The impact of money on inflation
C. The impact of technology on economics growth
D. The impact of the deficit on saving

A. Cover
B. Brandish
C. Display
D. Exhibit

A. it no longer needs any human capital
B. capital becomes more productive due to the “catch-up- effect”
C. none of these answers
D. it may be harder for it to grow quickly because of the diminishing returns to capital

A. it no longer needs any human capital
B. capital becomes more productive due to the “catch-up- effect”
C. none of these answers
D. it may be harder for it to grow quickly because of the diminishing returns to capital

A. free market solutions are efficient
B. free market solutions maximize total surplus
C. all of these answers
D. free market solutions are equitable
E. free market solutions are efficient and free market solutions maximize total surplus

(A) is linear (a straight line)
(B) becomes steeper as the quantity of the input increase
(C) could be any of these answers
(D) becomes flatter as the quantity of the input increase