If some activity creates external benefits as well as private benefits, then economic theory suggests that the activity ought to be

A. subsidized.
B. prohibited.
C. taxed.
D. left alone.


Answer: A

Economics

You might also like to view...

A bank's most important service is

a. making money b. providing checking account services c. organizing money flowing into accounts d. providing investment advice e. increasing the amount of cash the public holds

Economics

Cost curves in the long run differ from cost curves in the short run

a. True b. False Indicate whether the statement is true or false

Economics

The majority of payments made by the federal government are for

A. transfer payments. B. administrative expenses. C. foreign aid. D. defense purchases.

Economics

GDP does not include which of the following activities?

A. Businesses installing anti-pollution equipment B. Households spending to enhance security of their neighborhoods C. Couples remodeling their own homes D. Families eating out in restaurants

Economics