Q45 A negative externality such as pollution can be corrected bya subsidy to producers.O a tax on producers.O a subsidy to consumers.O a stimulus to production.

MSC- marginal social cost MEC- marginal external cost MPC- marginal private cost MPB - marginal…

Answered: A negative externality such as…

A negative externality such as pollution can be corrected by a subsidy to producers. a tax on producers. a subsidy to consumers. O a stimulus to production.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter12: Environmental Protection And Negative Externalities

Section: Chapter Questions

Problem 41P: Refer to Table 12.2. The externality created by the refrigerator production was 100. However, once...

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Question

Q45

A negative externality such as pollution can be corrected by
a subsidy to producers.
O a tax on producers.
O a subsidy to consumers.
O a stimulus to production.

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Draw a standard supply and demand diagram for televisions, and indicate the equilibrium price and output. a. Assuming that the production of televisions generates external costs, illustrate the effect of the producers being forced to pay a tax equal to the external costs generated, and indicate the equilibrium output. b. If instead of generating external costs, television production generates external benefits, illustrate the effect of the producers being given a subsidy equal to the external benefits generated, and indicate the equilibrium output.
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