A fertilizer plant emits a very foul odour during the production process. If the government forces the plant to internalize this negative externality, what would result? The demand curve for fertilizer would shift to the left (up). The supply curve for fertilizer would shift to the left (up). The demand curve for fertilizer would shift to the right (down). The supply curve for fertilizer would shift to the right (down).

Economics (MindTap Course List)
13th Edition
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Roger A. Arnold
Chapter30: Market Failure: Externalities, Public Goods, And Asymmetric Information
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A fertilizer plant emits a very foul odour during the production process. If the government forces the plant to
internalize this negative externality, what would result?
The demand curve for fertilizer would shift to the left (up).
The supply curve for fertilizer would shift to the left (up).
The demand curve for fertilizer would shift to the right (down).
The supply curve for fertilizer would shift to the right (down).
Transcribed Image Text:A fertilizer plant emits a very foul odour during the production process. If the government forces the plant to internalize this negative externality, what would result? The demand curve for fertilizer would shift to the left (up). The supply curve for fertilizer would shift to the left (up). The demand curve for fertilizer would shift to the right (down). The supply curve for fertilizer would shift to the right (down).
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