Graphically, the presence of an external cost that is ignored by producers can be shown as
A) a market supply curve to the left of the market supply curve for where the producers have to pay for the external cost.
B) a market supply curve to the right of the market supply curve for which the producers have to pay for the external cost.
C) a market supply curve the same as the market supply curve for which the producers have to pay for the external cost.
D) the absence of a market supply curve.
Answer: B
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According to the theory of efficiency wages, if a firm stops paying efficiency wages it is likely to see a(n)
a. increase in the number of job applicants and an increase in how long workers stay on the job. b. increase in the number of job applicants and a decrease in how long workers stay on the job. c. decrease in the number of job applicants and an increase in how long workers stay on the job. d. decrease in the number of job applicants and a decrease in how long workers stay on the job.
The cross price elasticity for peanut butter for a change in the price of jelly is likely to be
A. positive and less than 1. B. positive and greater than 1. C. zero. D. negative.
A monopolist suffers a loss if its ________ schedule is everywhere above its ________ schedule.
A. Demand; ATC B. ATC; Demand C. MC; AVC D. ATC; MC
If Claudette gets a permanent increase in her income of $1000 per year, she saves an extra $200 this year and consumes an extra $800 this year. If the increase in income had been temporary instead of permanent, she would have saved ________ of the extra income.
A. less than $200 B. exactly $200 C. more than $200 D. none