A uniform tax according to the physical quantities of pollution may not be the appropriate way to correct for an externality because
A) it places a unfair burden on small producers.
B) a uniform tax can only account for social costs and not external costs.
C) a firm will reduce production.
D) it may not adequately account for economic damages.
D
You might also like to view...
All of the following are considered input barriers to entry except:
A) control of a key raw material by a single firm. B) the ability to obtain financing for capital projects at more favorable rates than potential competitors. C) the fact that workers in a particular industry belong to a union. D) a patent on a specialized type of capital that is needed to produce a particular product.
If a firm is producing an output level at which marginal revenue exceeds marginal cost in the short run, the firm will increase profits by reducing its output level
a. True b. False Indicate whether the statement is true or false