If Government Uses Taxation to Correct for Negative Externalities, the Desired

question 169

Multiple Choice

If government uses taxation to correct for negative externalities, the desired consequence is

• A)a decrease in the quality of the good produced.
• B)an increase in the quantity of the good produced and/or consumed.
• C)a raise in revenue that can be used to provide subsidies to consumers.
• D)a decrease in the quantity of the good produced and/or consumed.
• E)increased revenue.

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Definitions:

Ingratiation

A psychological technique aimed at making oneself more likable or favorable to others by means of flattery or other forms of manipulation.

Well-deserved Flattery

Genuine praise given to someone based on their actual achievements or qualities.

Rational Persuasion

A method of influencing others through the use of logical arguments and factual evidence.

Credibility of Influence Agent

The degree to which an individual perceived as attempting to influence others is trusted or believed due to their expertise, reliability, and authenticity.