Governments can increase the consumption of a product that helps in reducing negative externalities by
A) subsidizing the purchase of the product.
B) taxing the consumption of the product.
C) assigning property rights to the producer of the product.
D) taxing the production of the product.
A
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The curve in the above figure will shift to the right when
A) the price level falls. B) the proportion of the population that is elderly increases. C) population falls. D) technology increases.
Which of the following is NOT a likely impact on the bond market if corporations become convinced that a robust economic recovery is underway?
A) increased demand for bonds B) increased supply of bonds C) lower bond prices D) higher interest rates
Which of the following is a valid reason for the government rather than the market to finance the provision of certain economic goods and services? a. When the government provides economic goods, they are free; costs are incurred when such goods are provided by private firms. b. Voters tend to be better informed than market consumers are
c. Decision makers in the market sector are motivated by self-interest, whereas political decision makers are primarily motivated by altruism (the desire to help others). d. Public goods tend to be undersupplied through the market since it is difficult for potential suppliers to withhold such goods from nonpaying consumers; the government can use taxes to overcome this problem of nonpayment.
Private markets fail to account for externalities because
a. externalities don't occur in private markets. b. sellers include costs associated with externalities in the price of their product. c. decisionmakers in the market fail to include the costs of their behavior to third parties. d. the government cannot easily estimate the optimal quantity of pollution.