Author Question: Suppose the government imposes a per unit tax on an item whose production process creates a negative ... (Read 124 times)

frankwu

  • Hero Member
  • *****
  • Posts: 549
Suppose the government imposes a per unit tax on an item whose production process creates a negative externality. Suppose the tax is exactly the value of the marginal externality cost. If the government now uses the tax revenue to clean up pollution from this process, the market will:
 a. have internalized all costs and benefits.
  b. be inefficient.
  c. be destroyed.
  d. not have failed.
  e. be subject to obligatory controls.

Question 2

Voluntary recycling is available in many parts of the country. If citizens of these areas have collected recyclable material at home, they can bring it to a recycling center. These materials reduce landfill space, reduce the need for virgin material extraction, and provide an inexpensive input in many production processes. The information in this question suggests what about areas without voluntary recycling?
 a. Externalities exist.
  b. There is mandatory recycling.
  c. Raw materials are less expensive.
  d. The cost of production is higher.
  e. Nothing.



InfiniteSteez

  • Sr. Member
  • ****
  • Posts: 340
Answer to Question 1

a

Answer to Question 2

e



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

The top 10 most important tips that will help you grow old gracefully include (1) quit smoking, (2) keep your weight down, (3) take supplements, (4) skip a meal each day or fast 1 day per week, (5) get a pet, (6) get medical help for chronic pain, (7) walk regularly, (8) reduce arguments, (9) put live plants in your living space, and (10) do some weight training.

Did you know?

Ether was used widely for surgeries but became less popular because of its flammability and its tendency to cause vomiting. In England, it was quickly replaced by chloroform, but this agent caused many deaths and lost popularity.

Did you know?

The top five reasons that children stay home from school are as follows: colds, stomach flu (gastroenteritis), ear infection (otitis media), pink eye (conjunctivitis), and sore throat.

Did you know?

The senior population grows every year. Seniors older than 65 years of age now comprise more than 13% of the total population. However, women outlive men. In the 85-and-over age group, there are only 45 men to every 100 women.

Did you know?

Excessive alcohol use costs the country approximately $235 billion every year.

For a complete list of videos, visit our video library