Penalties on sellers and buyers
What will be an ideal response?
Demand and supply both decrease
Larger penalties/enforcement = larger decrease
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In a market for emission permits, firms that emit over their allowed limits
A) are forced to shut down. B) are taxed by the government for the amount of emissions. C) receive a subsidy for the amount of emissions. D) pay a price of these emissions.
How are demand-pull and cost-push inflation reflected in terms of the AD-AS model?
Exhibit 15-4 Coffee and tea output (pounds per hour) CountryCoffee Tea Brazil10 5 China 8 8 If specialization were carried out by each country in Exhibit 15-4 on the basis of comparative advantage, then:
A. Brazil would produce neither coffee nor tea. B. China would produce both coffee and tea. C. Brazil would produce tea and China would produce coffee. D. Brazil would produce coffee and China would produce tea.
Explain what is meant by "internalizing an externality," and describe three methods by which this can be done.
What will be an ideal response?