Question

QUESTION 10 The regulatory approach for global waming that is the most efficient is by: price. subsidies. quantity taxing profits. QUESTION 11 One implication of the Coase Theorem (per class discussion) market failure is the primary cause of most externalities. "everyone is guilty and that at least some of the "blame for any of externality falls on all of the parties. a Pigouvian tax is usually the best approach to force internalization of externalities. the party that causes the externality is almost always guilty QUESTION 12 In our our basic pollution reduction model in Chapter 5, with perfect knowledge a price (tax) and quantity approaches lead to exactly the same outcome True False QUESTION 13 An example of a positive externality is the protection that results when the neighbors get a watchdog. a traffic jam that occurs when the town builds a new high school on the main road. a traffic jam that occurs when other drivers are rubber-necking a traffic accident None of the above answers is correct. QUESTION 14 Taxes and govemment expenditures that change in response to changes in the level of economic activity, without need for additional government action, are examples of discretionary fiscal variables. cyclically balanced budgets. built-in monetary stabilizers. automatic fiscal policy QUESTION 15 It is possible to eliminate the inefficiency that results from an external cost by granting subsidies lowering fines. establishing property rights forming a more competitive market. QUESTION 16 The cost of producing an additional unit of a good or service that is borne by the producer of that good or service is called the social marginal cost. private marginal cost external marginal cost. None of the above answers is correct.

Answer 1

10) Option D

• the regularity approach for global warming that is the most efficient is by taxing profits.
• The carbon taxes are beat way to control greenhouse emissions and global warming.
• The pollutants are laid to pay carbon taxes to reduce pollution.
• Global warming is caused by the drastic climatic changes that usually occurs due to the excessive pollution by the firm.
• If these firm's are taxed, then they will be having less incentive to pollute the environment which can reduce the effects of global warming in the economy

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