Which of the following would be a private cost to a cigarette manufacturer?
a. Price of leaf tobacco.
b. Cost to the government of the hospital expenses of indigent smokers.
c. Increased risk of cancer to the nonsmoking passengers in the smoker's carpool.
d. Price of a pack of cigarettes.
e. The loss in utility received because the smoker must stand outside her office building in the winter to smoke.
Question 2
Which of the following would be an external cost to the consumption of cigarettes?
a. Price of a pack of cigarettes.
b. Loss of income resulting from extra missed days of work.
c. Higher life insurance premiums due the practice of smoking.
d. The loss in utility received because the smoker must stand outside her office building in the winter to smoke.
e. Increased risk of cancer to the nonsmoking passengers in the smoker's carpool.
Leaf organization
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A company that makes cell phones has the following cost structure. They have fixed costs of ...