Governments can increase the consumption of a product that creates positive externalities by
A) taxing the production and consumption of the product.
B) subsidizing the production of the product so that the supply is increased and market price is reduced.
C) convincing everyone to consume the product.
D) assigning property rights to the producers of the product.
B
You might also like to view...
Refer to the scenario above. If both nations decide to trade, which of the following statements is true?
A) Hawaii should export both tea and coffee. B) Hawaii should import both tea and coffee. C) Hawaii should export tea and South Carolina should export coffee. D) Hawaii should export coffee and South Carolina should export tea.
Which of the following statements about the short run and long run is true?
A) The number of firms in the industry is fixed in the short run, but in the long run the number can change. B) Free entry and exit of firms is possible in the short run, but entry and exit of firms is restricted in the long run. C) The short-run average cost curves lies below the long-run average cost curves. D) A firm can vary all of its factors of production in both the short run and the long run.