Macroeconomics
13th Edition
ISBN: 9780134735696
Author: PARKIN, Michael
Publisher: Pearson,
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Chapter 16, Problem 8SPA
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The south African government develops targets that pertain to healthcare and education. Which of the following statements explains why government provides these two goods?
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C . The government spends money on health care and education because they are public goods
D. Health care and education only produce negative externalities.
Chapter 8 in Tietenberg and Lewis looks at climate change, the most important environmental issue of our time. Economists generally agree that putting a price on carbon is the best approach to reducing climate warming carbon emissions. The two main strategies for doing this are carbon taxes and the cap and trade version of emissions trading. Discuss the pros and cons to these two approaches to pricing carbon. Why do economists favor these kinds of market-based strategies to pollution control over “command and control” approaches such technology standards?
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Chapter 16 Solutions
Macroeconomics
Ch. 16.1 - Prob. 1RQCh. 16.1 - Prob. 2RQCh. 16.1 - Prob. 3RQCh. 16.1 - Prob. 4RQCh. 16.2 - Prob. 1RQCh. 16.2 - Prob. 2RQCh. 16.2 - Prob. 3RQCh. 16.2 - Prob. 4RQCh. 16.3 - Prob. 1RQCh. 16.3 - Prob. 2RQ
Ch. 16.3 - Prob. 3RQCh. 16.3 - Prob. 4RQCh. 16.3 - Prob. 5RQCh. 16 - Prob. 1SPACh. 16 - Prob. 2SPACh. 16 - Prob. 3SPACh. 16 - Prob. 4SPACh. 16 - Prob. 5SPACh. 16 - Prob. 6SPACh. 16 - Prob. 7SPACh. 16 - Prob. 8SPACh. 16 - Prob. 9SPACh. 16 - The Economics of Healthcare (Study plan 16.3) Use...Ch. 16 - Prob. 11APACh. 16 - Prob. 12APACh. 16 - Prob. 13APACh. 16 - Prob. 14APACh. 16 - Prob. 15APACh. 16 - Prob. 16APACh. 16 - Prob. 17APACh. 16 - Prob. 18APACh. 16 - Prob. 19APACh. 16 - Prob. 20APACh. 16 - Prob. 21APACh. 16 - Prob. 22APACh. 16 - Prob. 23APACh. 16 - Prob. 24APA
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- Economics: Public Economics Question: 1 Figure 3. On the graph, Q represents the quantity of foam and P represents the price of foam. Refer to Figure 3. If the government imposed a corrective tax that successfully moved the market from the market equilibrium to the social optimum, then tax revenue for the government would amount to (do not use $ sign) Guess: 10,000 (with margin: 0) Question: 2 Which of the following statements is correct? a. Corrective taxes are often preferred over direct regulation because they typically reduce externalities at a faster rate. b. Corrective taxes are often preferred over direct regulation because they typically reduce externalities at a higher cost. c. Corrective taxes are often preferred over direct regulation because they typically reduce externalities at a lower cost. d. Corrective taxes distort economic incentives. Question 3: According to the Coase theorem, externalities can be internalized when transactions costs are zero through:…arrow_forwardEconomics: Public Economics Question: 1 Figure 6 (Graph 5) Refer to Figure 6, Panel (b) and Panel (c). Which of the following is correct? a. A tax would move the market in Panel (c) closer to the socially optimal outcome, but a subsidy would move the market in Panel (b) closer to the socially optimal outcome. b. A subsidy would move the market in Panel (b) and the market in Panel (c) closer to the socially optimal outcome. c. A tax would move the market in Panel (b) and the market in Panel (c) closer to the socially optimal outcome. d. A subsidy would move the market in Panel (c) closer to the socially optimal outcome, but a tax would move the market in Panel (b) closer to the socially optimal outcome. Question: 2 Two arms, A and B, each currently emit 100 tons of chemicals into the air. The government has decided to reduce the pollution and from now on will require a pollution permit for each ton of pollution emitted into the air. The government gives each arm 40…arrow_forwardGrater consumption of alcohol leads to more motor vehicle accidents and, thus, imposes costs on people who do not drink and drive. a.) Illustrate the market for alcohol, labeling the demand curve, the social-value curve, the supply curve, the social-cost curve, the market equilibrium level of output, and the efficient level of output. b.) On your graph, shade the area corresponding to the deadweight loss of the market equilibrium. (Hint: The deadweight loss occurs because some units of alcohol are consumed for which the social cost exceeds the social value.) Explain.arrow_forward
- a)Some advocates of anti-poverty programs claim that fighting poverty is a public good. Explain what these advocates mean by classifying charity as a public good. b)Why do governments tend to run programs that help the poor? Can the private sector be left to run those programs? Discuss your answer by focusing on externalities and market failurearrow_forwardIn macroeconomics 1. List and explain the three ways in which there can be market failure. 2. Define externality and distinguish between positive and negative externality and their impact on production, using examples where possible. 3. How can a government correct for positive and negative externalities ? Give real life examplesarrow_forwardFrom CNN what news article represents an issue ragards to Externalities or that can be realted to externalities? Cite at least one source (News Article, Video, etc.) for any data. Explain: What is the Economic issue? (Describe the issue) What is the connection to Externalities? (positive, negative, policy) (Use Math, Graph or data to explain or support your idea) Explain how this affects the Economy (individual, industry, national or global)arrow_forward
- 1. What is market failure? Explain in your own words. 2. Why do markets fail. List two reasons and explain them in your own words. 3. Explain what an external effect (also known as an externality) is in your own words. 4. List four examples of externalities 5. Explain what a social dilemma is and list one example of a current social dilemma.arrow_forwardRaven Farms raises a substantial number of bees and uses the honey to produce its own skin healing cream. Raven Farms is situated next to Oakcreek Apple Orchard. The bees from Raven Farms pollinate Oakcreek's apple trees. In this instance, Raven Farms a) derives more private benefits and provides less social benefit. b) provides more social benefits than it derives in private benefits. c) provides a complete social benefit and derives a marginal private benefit. d) provides a marginal social benefit and derives a complete private benefit.arrow_forwardQuestion 1 A global-positioning anti-theft device installed by one car owner can produce a positive spillover to other citizens in a community. Discuss the impact on the: (i) Private benefit curve (ii) Social benefit curve (iii) Private cost curve (iv) Social cost curve (v) Market equilibrium level of output (vi) Efficient level of output Question 2 (a) Identify the type of market failure, explain why it occurs and provide a solution (i) An auto repair shop convinces you that you need a $20,000 valve job when all you need is an oil change. (ii) Everyone in the neighbourhood would benefit if an empty lot were turned into a park but no entrepreneur will come forward to finance the transformation (iii) A barking dog in the backyard (b) Define the tragedy of the commons in your own words. (c) Why are fish in the ocean an example of a resource that suffers from the tragedy of the commons but cattle grazing in a farmer’s pasture does…arrow_forward
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