When a market is characterized by an externality, the government
a. can correct the market failure only in the case of positive externalities.
b. can correct the market failure only in the case of negative externalities.
c. can correct the market failure in the case of both positive and negative externalities by inducing market participants to internalize the externality.
d. cannot correct for externalities due to the existence of patents.
c
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Refer to the above table. Which country has the lowest increase in per capita real GDP between 2014 and 2015?
A) A B) B C) C D) D
Suppose the following: (1 ) the wage rate rises, (2 ) the interest rate rises, (3 ) any change in AD is greater than any change in SRAS. Based on this information, in the short run Real GDP will __________ and the price level will __________
A) rise; rise B) fall; rise C) fall; fall D) rise; fall
How people respond to fiscal policy:
A. is fairly mechanical and appears to conform closely to the predictions of macroeconomic models. B. depends on whether the fiscal policy is financed from borrowing or from budget surpluses. C. depends on their evaluation of the state of the economy and their expectations about the future. D. generally reveals consistent irrationality and poorly-formed expectations about the future.
The tax brackets in a particular year are 10% on earnings up to $35,000, 20% on earnings from $35,001 to $75,000, 30% on earnings from $75,001 to $150,000, and 33% on earnings over $150,000. If Professor Schmidt earns $125,000, what is her marginal tax rate?
a. 10% b. 27% c. 30% d. 60%