There is no way that externalities can be corrected
a. True
b. False
Indicate whether the statement is true or false
False
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Refer to the scenario above. What is the present value of $3,400 to be received after five years?
A) $2,300.78 B) $2,540.68 C) $3,200.22 D) $3,526.44
The difference between the loss of surplus to taxpayers and the tax revenue collected is called:
A. an externality. B. deadweight loss. C. consumer surplus. D. producer surplus.
Which of the following statements is false?
A) The Dow Jones Industrial Average went down by 40 percent during the decade of the 1930s. B) Based on data from the period between 1926 and 2004, the probability of having a positive return on an investment in the stocks contained in the Dow Jones Industrial Average would have been 97.1 percent if the stocks had been held for 10 years. C) When reading the stock market page of a newspaper, if the column marked "Div." is blank, it means that the company does not currently pay out dividends. D) A stock that yields 4 percent is better than a stock that yields 5 percent, all else being the same.
A higher marginal income tax rate reduces incentives to work because:
A. leisure and other non-market activities aren't taxed, and so their relative price goes up. B. the opportunity cost of leisure remains constant while after-tax wages fall. C. the opportunity cost of leisure increases with the marginal income tax rate. D. leisure and other non-market activities aren't taxed, and so their relative price goes down.