Question 1
If the government wishes to encourage firms to internalize externalities, they should ________ activities resulting in negative externalities and ________ activities resulting in positive externalities
◦ tax; subsidize
◦ subsidize; tax
◦ ban; generate
◦ place an injunction against; tax
Question 2
Refer to Scenario 16.1 below to answer the question(s) that follow.
SCENARIO 16.1: The marginal benefit for a particular food is described by
MB = 30 -
q, where q refers to the quantity of the food. The marginal cost of producing the food is described by
MC = 2
q. There is a negative externality associated with food production and the marginal social cost of food production is
MSC = 4
q.
Refer to Scenario 16.1. The competitive output level is ________ and the competitive price is ________.
◦ 10 units of food; $20
◦ 6 units of food; $24
◦ 0 units of food; $0
◦ 4.29 units of food; $25.71
How to solve word problems with two unknowns (Question 2)
Remainder Question
Use the answer sheet below the problems for your answer
Refer to (d) in the figure above. This rectifier arrangement
Question 37 Part 2
Eco question 2