A subsidy to firms intended to reduce pollution in an industry would
A. shift the LRAC curve upward.
B. have the same impact on the firm as a tax.
C. likely drive some existing firms from the industry.
D. likely have the paradoxical effect of increasing pollution in the industry in the long run.
Answer: D
You might also like to view...
According to the graph, what is the reduction in U.S. lumber consumption as a result of the tariff?
a. 700,000 board feet
b. 100,000 board feet
c. 200,000 board feet
d. 300,000 board feet
Knowing the number of firms in a market is the only information needed to identify the structure of that market
a. True b. False
In this welfare effects of a tax graph, we can see that the tax changed consumer surplus from a + b + c to _____.
a. a + b
b. a
c. a – c
d. b + c
If domestic saving is greater than domestic investment, then a country will have a ________ and positive net capital ________.
A. trade surplus; inflows B. trade surplus; outflows C. trade deficit; inflows D. trade deficit; outflows