When external costs are present and the government imposes a tax equal to the marginal external cost, then

A) efficiency can be achieved.
B) transaction costs will be high.
C) the marginal benefit of the external cost will fall.
D) property rights must have already been established.

A

Economics

You might also like to view...

Keynes's theory of the demand for money implies that velocity is

A) not constant but fluctuates with movements in interest rates. B) not constant but fluctuates with movements in the price level. C) not constant but fluctuates with movements in the time of year. D) a constant.

Economics

The deadweight loss from a tax is the reduction in producer and consumer surplus minus the tax revenue transferred to the government

a. True b. False Indicate whether the statement is true or false

Economics