Which of the following might be a method that the government could use to correct a negative externality?
A. an effluent fee on waste from the production of goods that create negative externalities
B. encouraging overallocation of resources of production of goods that create negative externalities
C. government subsidies to producers of goods that create negative externalities
D. financing additional production of goods that create negative externalities
Answer: A
Economics
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Governments can reduce depletion of resources by restricting access to the resource
Indicate whether the statement is true or false
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Assume a firm is able to use an optimal two-part tariff
a. Is the outcome economically efficient? Why or why not? b. What happens to consumer surplus? c. Does this represent perfect price discrimination? Why or why not? What will be an ideal response?
Economics