When positive externalities exist, the government must _________ the production of the good generating the externalities in order to achieve ___________
a. allow the market to dictate; a socially optimal allocation of resources
b. tax; a socially optimal allocation of resources
c. subsidize; a socially optimal allocation of resources
d. subsidize; market equilibrium
e. tax; market equilibrium
C
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The MPC is equal to the
A) level of consumption expenditure divided by the level of total disposable income that brought it about. B) change in consumption expenditure divided by the total disposable income that brought it about. C) change in disposable income divided by the change in consumption expenditure. D) level of consumption divided by the change in disposable income that brought it about. E) change in consumption expenditure divided by the change in disposable income that brought it about.
What happened to real GDP and the inflation rate during the recession of 2007-2009?
What will be an ideal response?