A Negative Externality Problem

question 21

Multiple Choice

A Negative Externality Problem

Demand for a good is given by Q = 100 - P. The private marginal cost of production is MCP = 10 + Q. There is a $10 per unit negative production externality in this situation.


-Refer to A Negative Externality Problem.Suppose there are no transactions costs.Also suppose the externality is internalized when the damaged parties offer producers a bribe of $10 per unit to reduce their production.Coasian analysis indicates that social gain in this situation will equal

• A) $0
• B) $800
• C) $1,600
• D) $3,200

Comprehend the process and implications of transferring ownership of checks and other negotiable instruments.

Learn about the legal concept and implications of being a holder in due course.

Understand the warranties and liabilities of endorsers in the transfer of negotiable instruments.

Comprehend the concept of drafts, including sight drafts and bank drafts, and their use in commerce.

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Definitions:

Liabilities

Financial obligations or debts owed by a person or company to others.

Taxation Principle

The guidelines governing how taxes should be levied on individuals and businesses in a fair and efficient manner.

Tax Revenue

The income that is gained by governments through taxation from individuals and businesses.

Economic Income

The total value of all income generated by the assets of an individual or organization, including both realized and unrealized gains.