A Pigouvian Tax Can Lead to the Efficient Level of Production

question 49

Multiple Choice

A Pigouvian tax can lead to the efficient level of production and consumption of:

• A)a public good.
• B)a common resource.
• C)an artificially scarce good.
• D)no goods since all taxes cause inefficiency.

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Definitions:

Political Borders

Imaginary lines that define the boundary of a nation or state, separating it from other nations or states.

Exploitation

The action or fact of treating someone unfairly in order to benefit from their work or resources.

Privilege

Unearned advantage accorded to members of dominant social groups (males, whites, heterosexuals, the physically able, etc.).

Unearned

Income or benefits received without a direct exchange of goods or services, such as inheritance, gifts, or subsidies.