In 2017, Economists Working at the U

question 239

Multiple Choice

In 2017, economists working at the U.S.Department of Treasury's Office of Tax Analysis have estimated that the marginal social cost of carbon dioxide emissions was about

• A)$7 per metric ton.
• B)$32 per metric ton.
• C)$49 per metric ton.
• D)$70 per metric ton.

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Definitions:

APT

Abbreviation for Arbitrage Pricing Theory, a multifactor financial model that describes the relationship between the return of a portfolio and the return of a single asset through a linear combination of macroeconomic factors.

CAPM

A model identifying the connection between the expected returns of assets, primarily shares, and their associated systematic risk, known as the Capital Asset Pricing Model.

Systematic Risk Factors

Market risks that affect the overall market and cannot be eliminated through diversification, such as interest rates, inflation, and economic cycles.

Equally-Weighted Portfolio

An investment portfolio where each asset is allocated the same proportion of the total investment.