Author Question: The cost of producing one more unit of a good or service that is paid by the producer A) has to ... (Read 131 times)

dollx · **on:** Jun 29, 2018

The cost of producing one more unit of a good or service that is paid by the producer

A) has to be equal to the benefit that the consumer derives from that good.
B) is equal to the cost borne by people other than the producer.
C) is the marginal private cost.
D) is the marginal external cost.

Question 2

On Green Island, the demand for pencils is perfectly elastic and the supply of pencils is perfectly inelastic. If a sales tax on pencils is introduced

A) the tax is split evenly between the buyers and sellers.
B) the buyers pay the entire tax.
C) no one pays the tax.
D) the sellers pay the entire tax.