Suppose that instead of implementing the policy described in the article, the government introduces a per-unit tax of size P3-P1 on buyers. Price of high emissions vehicles True P3 O False 0 B D Qu Social Value S D True or false: The alternative policy fully internalises the externality. Quantity of high emissions Vehicles

Suppose that instead of implementing the policy described in the article, the government introduces a per-unit tax of size P3-P1 on buyers. Price of high emissions vehicles True P3 O False 0 B D Qu Social Value S D True or false: The alternative policy fully internalises the externality. Quantity of high emissions Vehicles

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 29CTQ: Suppose you want to put a dollar value on the external costs of carbon emissions from a power plant....

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Assume that the marginal private costs of a film producing fuel-efficient can; is greater than the marginal social costs. Assume that the marginal private benefits of a firm producing fuel efficient cars are the same as the marginal social benefits. Discuss one wags.r that the government cans ï¬‚y to increase production and sales of fuel efficient cars to the socially desirable amount. Hint: the government is flying to affect production through costs, net benefits.
Refer to Table 12.2. The externality created by the refrigerator production was 100. However, once we accounted for both the private and additional external costs, the market price increased by only 50. If the external costs were 100 why did the price only increase by 50 when we accounted for all costs?
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.
Give an example of a positive externality and an example of a negative externality.
Identify the following situations as an example of a negative or a positive externality: You are a birder (bird watcher), and your neighbor has put up several birdhouses in the yard as well as planting trees and flowers that attract birds. Your neighbor paints his house a hideous color. Investments in private education raise your countrys standard of living. Trash dumped upstream flows downstream right past your home. Your roommate is a smoker, but you are a nonsmoker.
Do market demand curves reflect positive externalities? Why or why not?
What is a pollution charge and what incentive does it provide for a firm to take external costs into account?
Suppose you want to put a dollar value on the external costs of carbon emissions from a power plant. What information or data would you obtain to measure the external [not social] cost?