Microeconomics
Microeconomics
11th Edition
ISBN: 9781260507140
Author: David C. Colander
Publisher: McGraw Hill Education
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Chapter 8, Problem 15QE
To determine

The example of screening.

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What would happen if the government subsidized consumption of this product because it has positive externalities in consumption?
Which of the following illustrates the concept of externalaties?       A. A hurricane destroys a production plant causing the owner of the plant to spend more money rebuilding               B. Pollution by a coal mining plant causes a farmer to spend more money on fertilizer to improve his crop     C. Increase in the price of sugar raises the price paid by consumers of  soda, thereby disadvantaging these consumers   D. Smoking harms the health of the smoker
What"s correct when the government requires those buying a vehicle to provide a parking space prior to granting of vehicle registration documents. A. it is unfair because there have been many who were granted registration of vehicles without complying with this rule B. it is commendable because it eliminates negative externalities C. it is to be completely opposed because it will be another source of corruption D. A and B are correct E. B and C are correct

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