Large taxes on energy companies whose production activities cause environmental damage (assume a negative externality). Give three reasons why this policy should be used.

Q: In theory, the Pigouvian tax... Group of answer choices revenue should be spent on mitigating the…

A: Pigouvian Tax is defined as a tax which is levied on the market transaction which tends to create an…

Q: True or false. When industry profits decline and firms exit, the equilibrium price increases. Hence,…

A: A negative externality occurs when the production or consumption of a good or a service has a…

Q: Unlike mining, the growing of forests often involves positive externalities for other people…

A: Positive externalities: - positive externalities mean positive spillovers or it refers to the…

Q: Consumption of a good creates a positive externality. Marginal costs are 0.5q + 60, marginal…

A: Marginal Cost refers to the extra expense incurred in producing an additional unit of a good or…

Q: Providing a subsidy is one way a society can correct for a positive externality. True False

A: Externality refers to spill-over effect of a good on third party which is not involved in either…

Q: The marginal social cost (MSC) of an electricity generating plant that uses coal is estimated by a…

A: Given p = 60-2Q TR = 60Q-2Q2 MSC=3Q MPC = Q

Q: If a positive externality exists in a market, the unregulated market produces too little of a…

A: Externality is the external cost or benefits that is unavoidable and is borne by the third party.…

Q: The effect of a positive externality is similar to:      A supply curve (marginal social cost)…

A: This can be defined as a cost that shows the type of cost that an individual, business, or any other…

Q: Which of the following would result in a positive externality? Group of answer choices A)A power…

A: In economics, positive externality exists when benefits are gained by a third party who is not…

Q: suppose that the xyx industry produces a product that result in negative external cost to society.…

A: Meaning of Macroeconomics: The term macroeconomics refers to the situation of economic and…

Q: Analyze the relationship between negative externalities and inefficient overproduction

A: A benefit or expense that occurs as a result of the producer's activity but is not borne by the…

Q: externality, either positive or negative,

A: Externalities: It refers to the cost which occurs in the process of production and consumption which…

Q: Distinguish carefully between a positive externality and a negative externality.  Explain your…

A: Externality is a cost occurred or benefit received by any third person who is not involved in the…

Q: Identify a negative externality

A: Externality is the negative or positive spillover by the consumer or producer which affects the…

Q: Provide examples of public goods or externalities that are provided successfully by market or…

A: Public goods are defined as goods that are non-rival and non-excludable in nature.

Q: Examine positive and negative externalities in an industrial sector

A: An externality is the benefit or cost borne by the third party as a result of a production or…

Q: Give a recent example of a demand side market failure (Positive Externality). Why did it happen?

A: A market is a place where the buyers and sellers interact with each other and the exchange of goods…

Q: Give three examples of activities accompanied by external costs and benefits.

A: The external costs and benefits are the various cost and benefits that are recieved to the third…

Q: The market for plasticans is perfectly competitive. Market Supply is given by Q=6P and Market Demand…

A: GIVEN   The market for plasticans is perfectly competitive. Market Supply is given by Q = 6P…

Q: Describe a situation where you experienced a positive or negative externality or free-riding by you…

A: Externality refers to the cost or benefit that is incurs by a third person or group that is not…

Q: Describe how government actions can lead to more efficient outcomes when negative and positive…

A: Externalities are certain benefits or losses accrue to a third person who is not involved in the…

Q: If a firm does not pay for an external cost, who does? Why might there be a deadweight loss in a…

A: External costs referred to the costs borne by entities which were not caused directly by them. These…

Q: A positive externality arises when a third party, outside the market transaction, fails to allocate…

A: An externality is an incidental effect or result of an industrial or commercial action that…

Q: If the production of a good causes a negative externality, the efficient level of output of that…

A: A negative externality is a cost borne by a third party as a result of an economic transaction. The…

Q: In a market with a negative externality, like houses being painted with lead paint, the quantity…

A: Negative externality creates an external damage to the third party who is not directly involved in…

Q: Large taxes on energy companies whose production activities cause environmental damage. How does…

A: Negative externality refers to the cost incurred by society due to the actions of a producer. This…

Q: Suppose that the xyz industry produces a product that result in negative external cost to society.…

A: Meaning of Macroeconomics: The term macroeconomics refers to the situation of economic and…

Q: An externality arises when a firm or person engages in an activity that affects the wellbeing of a…

A: An individual’s willingness to pay for each unit of the quantity he or she wishes to consume is…

Q: Explain why, in the absence of governmental environmental regulation, competitive markets…

A: Externality is the spillover effect to the third party other than the immediate market participant.…

Q: With this type of externality, in the absence of government intervention, the market equilibrium…

A: An externality refers to the costs or benefits that arise from an economic activity and impact a…

Q: A negative externality is a cost associated with an action that is not borne by the person who…

A: A negative externality is a cost that is suffered by a third party due to any production or…