If some activity creates positive externalities as well as private benefits, then economic theory suggests that the activity ought to be:
A. left alone under the idea of laissez faire.
B. subsidized.
C. taxed.
D. prohibited.
Answer: B
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Which of the following correctly describes a final good?
i. A final good is bought by its final consumer. ii. A final good can be used by a firm as a component of another good or service. iii. Investment goods cannot be a final good. A) i only B) i and ii C) i, ii and iii D) i and iii E) ii and iii
The figure above shows that as a result of the tariff, consumer surplus in the United States
A) decreases by $105 million per year. B) increases by $55 million per year. C) decreases by $30 million per year. D) decreases by $20 million per year. E) remains unchanged.
Explain why firms' short-run marginal cost curves often initially decreases and then increases
What will be an ideal response?
If demand is inelastic, the absolute value of the price elasticity coefficient is greater than one
Indicate whether the statement is true or false