If a Pigovian tax is too large, the resulting:
A. quantity will be too high.
B. outcome will not maximize surplus.
C. outcome will still be efficient.
D. All of these statements are true.
B. outcome will not maximize surplus.
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Assume a customer of natural gas is negotiating with his supplier over the telephone. At the time prices of all the supplier's competitors are precisely the same
The customer tells the supplier that if he raises his price even one penny he will walk away. What does the perceived demand curve for natural gas look like for this customer? Why?
What is the marginal utility per dollar and how is it calculated?
What will be an ideal response?
Suppose a new cost-saving device will forever generate $1,000 net savings per year to a firm. The device costs $10,000. Using the Internal Rate of Return approach, the firm will make the investment
A) definitely. B) definitely not. C) if the interest rate exceeds 10%. D) if the interest rate is less than 10%.
What is the Nash equilibrium of this game?
a. Both the vendors price high b. Both the vendors price low c. Vendor A prices high, vendor B prices low d. Vendor B prices high, vendor A prices low