Suppose the market for oranges is perfectly competitive and unregulated. Suppose also that the chemicals used to keep the oranges insect-free damage the environment by an estimated $1 per bushel of oranges. Suppose QD = 1000 - 100P and QS = -100 + 100P. The tax that would have to exist to achieve the socially optimal level of production would be
a. $0
b. $.50
c. $1
d. $2
c
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Why are corporate executives are often guaranteed "golden parachutes" if they should be fired?
a. To give them the incentive to take the higher levels of risk desired by stockholders. b. To ensure that they exercise great caution in spending stockholders' money. c. To encourage the most experienced people to apply for the executive positions. d. To provide a signal to the public that the firm is on solid financial ground.
Low demand consumers are indifferent between second degree and first degree price discrimination.
Answer the following statement true (T) or false (F)
Which of the following is a key determinant of the price elasticity of supply?
A) the available technology B) the availability of substitutes in production C) the time it takes to change output in response to a change in price D) the slope of the supply curve
A doubling of income will result in a doubling of autonomous investment
Indicate whether the statement is true or false