When the production of one good spills benefits over to third parties, the government should consider all of the following EXCEPT
A) subsidizing the consumption of the good.
B) subsidizing the production of the good.
C) creating tax incentives to encourage more consumption.
D) taxing the production or consumption of the good.
D
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If only one firm in an industry could take advantage of a reduced wage and all other firms continue paying the old wage, how would one best describe the one firm's reaction to this reduced wage assuming labor is the only variable input? The
marginal revenue product of labor curve A) would remain unchanged, and the firm would hire more labor at the lower wage. B) shifts to the left, and the firm hires more labor at the lower wage on the new curve. C) shifts to the right, and the firm hires more labor at the lower wage on the new curve. D) shifts to the left, and the firm hires less labor at the lower wage on the new curve. E) shifts to the right, and the firm hires less labor at the lower wage on the new curve.
Which of the following are determinants of differences in income?
A. marginal productivity B. discrimination C. age D. all of these
Last year, Linus earned a salary of $25,000 and he spent $24,000, thus saving $1000. At the end of the year, he received a bonus of $1000 and he spent $500 of it, saving the other $500. What was his marginal propensity to consume?
A. .96 B. .04 C. .50 D. .02
If an Atlanta bakery raises the price of their rye bread by 11 percent and the quantity demanded decreases by 11 percent, then the demand for the rye bread is ________ and the bakery's total revenue ________
A) unit elastic; does not change B) unit elastic; increases C) unit elastic; decreases D) elastic; does not change E) inelastic; does not change