Government often finds it difficult to cope with externalities because
A. costs and benefits are difficult to assess in monetary terms.
B. taxes and subsidies are ineffective in equating MSC and MSB.
C. government has no authority to impose fines for air and water pollution.
D. marginal private cost curves cannot be shifted.
Answer: A
You might also like to view...
________ taxes are taxes paid when purchasing specific goods such as alcohol, tobacco, and gasoline
A) Property B) Payroll C) Wealth D) Excise
Seigniorage is defined as the difference between the exchange value of a money and its cost of production
Indicate whether the statement is true or false
Which of the following are accurate arguments suggesting that the fiscal stimulus did work?
a. Real GDP growth moved from negative to positive in 2009. b. Employment increased in 2009. c. The economy has natural self-correcting mechanisms. d. The return on bailout assets reduced the deficit.
Assuming constant returns to scale, if two countries are otherwise the same, the one that is poorer grows faster
a. True b. False Indicate whether the statement is true or false