What happens in a supply and demand diagram of the pesticide market when a corrective tax is used to solve a negative externality problem? Select one: a. The equilibrium quantity rises as the supply curve shifts left. b. The marginal external cost curve becomes the supply curve. c. The tax causes a rightward shift of the supply curve. d. The marginal social cost curve becomes the supply curve.
What happens in a supply and demand diagram of the pesticide market when a corrective tax is used to solve a negative externality problem? Select one: a. The equilibrium quantity rises as the supply curve shifts left. b. The marginal external cost curve becomes the supply curve. c. The tax causes a rightward shift of the supply curve. d. The marginal social cost curve becomes the supply curve.
Chapter8: Market Failure
Section: Chapter Questions
Problem 2P: Draw a standard supply and demand diagram for televisions, and indicate the equilibrium price and...
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What happens in a supply and demand diagram of the pesticide market when a corrective tax is used to solve a negative externality problem?
Select one:
a. The equilibrium quantity rises as the supply curve shifts left.
b. The marginal external cost curve becomes the supply curve.
c. The tax causes a rightward shift of the supply curve.
d. The marginal social cost curve becomes the supply curve.
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