The imposition of a per-unit tax on polluting firms will result in the socially efficient level of production only if the tax equals:
a. the marginal social cost plus the marginal private cost.
b. the marginal social cost plus the marginal external cost.
c. the marginal social cost minus the marginal private cost.
d. the average total cost minus the average variable cost.
c
You might also like to view...
The January effect
A) largely disappeared after receiving attention in the 1980s. B) refers to the gap between futures prices and the prices of the underlying securities that occurs each January. C) was stronger during the 1980s than during previous decades. D) is the observation that stocks tend to be sold off in January.
If OPEC increases its price of oil, and still the demand for oil decreases by a very small amount, we can conclude that the demand for oil is
A) relatively elastic. B) relatively inelastic. C) perfectly elastic. D) perfectly inelastic.
Assume that an oligopolist faces a kinked demand curve. Suppose that the marginal cost curve passes through the gap in the marginal revenue curve. Price and output will be determined
a. drawing a line from the point where MC = P to both the vertical and horizontal axis, the vertical indicating output, the horizontal indicating price b. drawing a line from the point where MC = P to both the vertical and horizontal axis, the vertical indicating price, the horizontal indicating output c. at the kink d. at ATC = MC which, too, passes through the gap e. to be zero because the MC curve passes through the gap
A 14 year old boy who works in a bakery shop is a part of the labor force
a. True b. False Indicate whether the statement is true or false