Draw an analogy between a cap-and-trade program for air
pollution emissions and a market for water consumption permits
during a drought. how would these two policies be similar? how
would they differ? Be sure to address the source of the potential
gains from a market based approach in each of these cases
Discuss how the optimal capital structure is determined (i.e.,
what variable(s) suggest that a level of debt is optimal). Discuss
the pros and cons of adding debt to a zero or low debt firm.
If the socially optimal pollution level does not currently
exist, outline some reasons as to why applying the Coase Theorem
may not be successful in attaining it.
To induce a polluter to emit its socially optimal pollution
level, are emission taxes or emission standards more efficient if
there is uncertainty about the extent of the relevant benefits and
costs of polluting?
How closely should rating agencies work with the firms they are
reviewing? I.e., what level of independence is appropriate?
Should financial analysts be held liable for their opinions
regarding the financial health of firms?
2. Explain how
each of the following affect the optimal method of acquiring an
input i.e., make or buy:
a. A
complex contracting environment (4 points)
b. An
investment in a specialized machine (4 points)
c. Opportunistic
behavior (4 points)
d. Timing
in the production process (4 points)
Which level consists of related organs that work to achieve a
common function?
A.Organ Level
B.cellular level
C.chemical level
D.Tissue level
E. Organ system level
a. Explain and describe the magnitude of the optimal production
level of an item that has a negative externality (for example:
pollution), if the company takes into account social costs. Compare
this level of production with the level of production which only
takes into account 'private costs' (private cost). b. What policy
can be done by the government to reduce the production of goods
that have negative externalities and encourage the production of
goods that have positive externalities? Explain.