When a negative externality exists in a market, total surplus:
A. is decreased by deadweight loss compared to that same market without a negative externality.
B. is the same as a market without a negative externality.
C. is increased by deadweight gain compared to that same market without a negative externality.
D. is the same but re-distributed differently than if that same market did not have a negative externality.
A. is decreased by deadweight loss compared to that same market without a negative externality.
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A firm is an organization that produces
a. only goods for sale to households b. only services for sale to households c. goods and services for sale to households and businesses d. only goods for sale to other businesses e. only resources
Yoyo's Frozen Yogurt, Inc is thinking of building a new warehouse. They believe that this will give them $50,000 of additional revenue at the end of one year, $60,000 additional revenue at the end of two years, and $70,000 in additional revenue at the end of three years. If the interest rate is 5 percent, Yoyo would be willing to pay
a. $140,000, but not $150,000. b. $150,000, but not $160,000. c. $160,000, but not $170,000. d. $170,000, but not $180,000.
Political decision making tends to be biased toward the adoption of programs that have
A) future costs and future benefits that are both difficult to identify. B) future costs that are difficult to identify and current benefits that are easily observable. C) current costs that are easily observable and future benefits that are difficult to identify. D) current costs and future benefits that are both easily observable.
In the long run, a reduction in the corporate profits tax will lead to ________ profits in the corporate sector and ________ profits in the noncorporate sector.
A. lower; lower B. higher; lower C. higher; higher D. lower; higher