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Author Question: The figure above shows a tax imposed on a good with an external cost. The area of the rectangle abcd ... (Read 106 times)

bio_gurl

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on: Jun 29, 2018
The figure above shows a tax imposed on a good with an external cost. The area of the rectangle abcd equals
 
  A) the MSB.
  B) the total tax revenue collected by the government.
  C) the amount of pollution tax per ton.
  D) the MC.
  E) the deadweight loss.

Question 2

An optimizing consumer has to choose between two goodsGood A priced at PA and Good B priced at PB.
 
  Given that MBA is the marginal benefit from consuming Good A and MBB is the marginal benefit from consuming Good B, the consumer's well-being will be maximized at the point where: A) MBA = MBB.
  B) MBA/PB=MBB/PA.
  C) MBA/PA = MBB/PB.
  D) MBA = MBB/PB.
Foundations of Microeconomics ¦ Bade, Parkin ¦ 8th Edition
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mochi09

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Reply #1 on: Jun 29, 2018
Answer to Question 1

B

Answer to Question 2

C


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