11.04Unanswered • 2 attempts leftWhen a corrective tax is created so that it equalsthe external costs linked to the production of aproduct, it willand the market result becomesthe price buyers payefficient.Adecrease; moreBdecrease; lessCincrease; moreDincrease; less

A corrective tax is an instrument used by the government to address market failure. Taxes increase…

Answered: When a corrective tax is created so…

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter10: Externalities

Section: Chapter Questions

Problem 3CQQ

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When the government levies a tax on a goodequal to the external cost associated with thegood’s production, it _________ the price paidby consumers and makes the market outcome_________ efficient.a. increases; moreb. increases; lessc. decreases; mored. decreases; less
When the government levies a tax on a good equalto the external cost associated with the good'sproduction, it ___ the price paid by consumersand makes the market outcome efficient.a. 1ncreases, moreb. increases, lessc. decreases, mored. decreases, less
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When a corrective tax is created so that it equals the external costs linked to the production of a product, it will the price buyers pay and the market result becomes efficient. A decrease; more B decrease; less C increase; more D increase; less