Taxation may improve the social welfare when the taxed good
a. is socially undesirable (like, in some views, liquor and pornography).
b. imposes negative externalities.
c. is overproduced under a free-market system.
d. All of the above are correct.
d
Economics
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The high cost of advertising during the Super Bowl will
A) not affect the efficient level of output because advertising is a sunk cost. B) will affect the efficient level of output because profits will fall significantly. C) not affect the efficient level of output because advertising is a fixed cost. D) Not enough information given.
Economics
Suppose the market for a good is initially in equilibrium. Which of the following is most likely to happen if supply increases by a smaller amount than the increase in demand?
| a. | ||
| b. | ||
| c. | ||
| d. | ||
| e. |
Economics