Principles of Microeconomics
7th Edition
ISBN: 9781305156050
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 10, Problem 3CQQ
To determine
Tax and externality.
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Alcohol taxes that are used by government as an incentive for distillers and beer wholesalers to cut back on their
alcohol sales which create external costs are called
Sales taxes
a.
Marketable permits
Ob.
Subsidies
C.
Pigouvian taxes
Od.
Question 32
External costs are the result of the actions of
fırms and consumers.
fırms, consumers, and the government.
O the government.
fırms.
O consumers.
Chapter 10 Solutions
Principles of Microeconomics
Ch. 10.1 - Prob. 1QQCh. 10.2 - Prob. 2QQCh. 10.3 - Prob. 3QQCh. 10 - Prob. 1CQQCh. 10 - Prob. 2CQQCh. 10 - Prob. 3CQQCh. 10 - Prob. 4CQQCh. 10 - Prob. 5CQQCh. 10 - Prob. 6CQQCh. 10 - Prob. 1QR
Ch. 10 - Prob. 2QRCh. 10 - Prob. 3QRCh. 10 - Prob. 4QRCh. 10 - Prob. 5QRCh. 10 - Prob. 6QRCh. 10 - Prob. 1PACh. 10 - Prob. 2PACh. 10 - Prob. 3PACh. 10 - Greater consumption of alcohol leads to more motor...Ch. 10 - Prob. 5PACh. 10 - The many identical residents of Whoville love...Ch. 10 - Prob. 7PACh. 10 - Prob. 8PACh. 10 - Prob. 9PACh. 10 - Prob. 10PA
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- Provide examples of externalities. Question 2 of 27 Littering while hiking is an example of a externality. A firm doing research and development which can be used by other firms is an example of a OA. negative consumption; positive production B. positive consumption; negative production C. positive production; negative consumption D. negative production; positive consumption externality.arrow_forwardWhich of the following is not an advantage of corrective taxes? Ca. They subsidize the production of goods with positive externalities. Ob. They enhance economic efficiency. Oc. They raise revenues for the government. Od. They move the allocation of resources closer to the social optimum.arrow_forwardRefer to the provided supply-and-demand graph. S1 and D1 represent the current market supply and demand, respectively. S2 and D2 represent the total-cost supply and total-benefits demand. The positions of the graphs indicate that there are Multiple Choice a. external benefits from producing and consuming the product. b. external benefits from producing and external costs from consuming the product. c. external costs from producing and consuming the product. d. external costs from producing and external benefits from consuming the product.arrow_forward
- If a negative supply-side externality (also called a negative externality in production) occurs, then: a. The market provides the efficient allocation. b. The market under-provides the product, meaning the market allocation is less than the efficient allocation. c. The market does not provided the product, hence market failure occurs. d. The market over-provides the product, meaning the market allocation is more than the efficient allocation.arrow_forwardQuestion 29 E G H What kind of externality is depicted above? a. Positive Production Externality b. Negative Consumption Externality c. Positive Consumption Externality d. Positive Production Externality Supply MS B Demandarrow_forwardFor each of your answers to Exercise 12.2, will equilibrium price rise or fall or stay the same?arrow_forward
- Which of the following best describes why the government is not able to decide whether it will be consumers or producers will pay a tax. a. The tax changes the equilibrium price, so that producers and consumers share the burden of the tax. b. The tax corrects an externality. c. Producers will always pass the entire tax onto consumers d. A tax on consumers will result in an increase in supplyarrow_forwardwhat is public consumption? Explain.arrow_forwardSuppose that before tax was imposed 400 million gallons of gasoline was supplied at $3.00 per gallon.a. What happens when government imposes a tax of 60 cents per gallon on sellers? b. How would such a tax affect the market for gasoline i.e. what is the new equilibrium? c. On whom does the incidence of the tax fall more heavily? d. How much government revenue will be generated by the excise tax? e. What happens when government imposes a tax of 60 cents per gallon on buyers? f. How would such a tax affect the market for gasoline i.e. what is the new equilibrium?arrow_forward
- If production of a good is known to create external benefits a. Those benefits are larger than those received by the consumers of that good b. Those benefits are smaller than those received by the consumers of that good c. Those benefits are the same as those received by the consumers of that goodarrow_forwardO Macmillan Learning Using the information in the graph, answer the three questions. What is the value of the efficient per-unit tax at the socially optimal equilibrium? What are tax revenues at the socially optimal equilibrium, in millions? Price and cost (per pound) $20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 1 I 1 1 1 L 1 1 1 1 T per-unit tax: $ T F T tax revenues: $ 1 1 i 1 T 1 1 1 1 T T I I I Social marginal cost Private marginal cost 1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Fertilizer (millions of pounds per year) Demandarrow_forwardIf a positive demand-side externality (also called a positive externality in consumption) occurs, then: a. The market provides the efficient allocation. b. The market under-provides the product, meaning the market allocation is less than the efficient allocation. c. The market does not provided the product, hence market failure occurs. d. The market over-provides the product, meaning the market allocation is more than the efficient allocation.arrow_forward
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