If the Government Wishes to Encourage Firms to Internalize Externalities

question 273

Multiple Choice

If the government wishes to encourage firms to internalize externalities, they should ________ activities resulting in negative externalities and ________ activities resulting in positive externalities

• A) tax; subsidize
• B) subsidize; tax
• C) ban; generate
• D) place an injunction against; tax

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Definitions:

Cultural Barrier

involves differences in cultural practices, beliefs, and values that can impede understanding, interaction, and cooperation among people from different cultural backgrounds.

Supplier Relationship

The strategic management of interactions and engagements between a business and its suppliers to optimize the value of those relationships.

Political Conditions

The state of the political environment in a country, including factors such as government stability, laws and policies, and political events.