6. One rationale for imposing taxes on alcohol con- sumption is that people who drink alcohol impose negative spillovers on the rest of society- for example, through loud and unruly behavior or intoxicated driving. If this rationale is correct, in the absence of governmental taxation, will people tend to consume too much, too little, or the right amount of alcohol?

6. One rationale for imposing taxes on alcohol con- sumption is that people who drink alcohol impose negative spillovers on the rest of society- for example, through loud and unruly behavior or intoxicated driving. If this rationale is correct, in the absence of governmental taxation, will people tend to consume too much, too little, or the right amount of alcohol?

Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781305971509

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter8: Application: The Costs Of Taxation

Section: Chapter Questions

Problem 4PA

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