If a good has an external benefit, efficiency can be achieved by

A) leaving the market unregulated.
B) monopolizing the market.
C) offering a private subsidy on the good equal to the external benefit.
D) imposing a tax on the good equal to the external benefit.


C

Economics

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Each of the following took place in the latter half of the 1990s except

A. a falling rate of inflation. B. a rising stock market. C. an economic boom. D. a rising unemployment rate.

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Given a downward-sloping aggregate demand curve, if short-run aggregate supply increases, real GDP must increase and nominal GDP must fall

a. True b. False Indicate whether the statement is true or false

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If the Fed wishes to decrease the money supply, it could:

A. buy bonds. B. increase the reserve requirement. C. decrease the discount rate. D. print less currency.

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Tombstones are produced in a monopolistic competitive market. One producer, Rolling Stones, sells 20 tombstones a week at a price of $500 each. Its average total cost is $600 . Its total variable cost is $2,000 . Its demand curve is downward sloping. Given this information, we know that

a. new firms will enter the market b. Rolling Stones loses $2,000 a week c. Rolling Stones makes an economic profit of $400 d. Rolling Stones makes an accounting profit of $100 e. Rolling Stones should increase production because with a downward-sloping demand curve, it will increase its economic profit

Economics