A shift from S1 to S2 reflects the change that happens when a negative externality is taken into account. A shift from D1 to D2 reflects the change that happens when a positive externality is taken into account.Refer to above figures. Prior to the shift of the curves, which panel and which curve involve the existence of negative externality?
A. Panel 1 and S1
B. Panel 1 and S2
C. Panel 2 and D1
D. Panel 2 and D2
Answer: A
You might also like to view...
A public debt that is owed to foreigners can be burdensome because
A. the payment of interest will necessarily have a deflationary effect on prices in the paying nation. B. the payment of interest will conflict with a nation's foreign aid programs. C. the payment of interest reduces the volume of goods and services available for domestic uses. D. foreign interest rates are persistently higher than domestic interest rates.
Demand is generally
A. equally elastic in both the short run and the long run. B. relatively more elastic in the long run than in the short run. C. relatively more elastic for "necessities" than it is for "luxuries." D. relatively more elastic in the short run than in the long run.
The above figure shows the U.S. market for wheat. With no international trade, the price of wheat in the United States is ________ per ton. With international trade, the price of wheat in the United States is ________ per ton
A) $700; $300 B) $500; $700 C) $500; $300 D) $14; $16 E) $16; $14
Which of the following criteria need NOT be satisfied for choosing a policy instrument?
A) The variable must be measurable. B) The variable must be controllable. C) The variable must be predictable. D) The variable must be transportable.