If Markets Are Perfectly Competitive and Production of a Good

question 80

Multiple Choice

If markets are perfectly competitive and production of a good results in water pollution, the imposition of a tax on that good will:

• A) increase both the price of that good and pollution.
• B) reduce the price of that good and increase pollution.
• C) reduce both the price of that good and pollution.
• D) increase the price of that good and reduce pollution.

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Definitions:

Cooperation

The process of groups or individuals working or acting together for a common purpose or benefit.

Statuses

The positions or roles individuals hold within a social structure, which determine their social identity, obligations, and rights.

Roles

The functions, positions, or behaviors expected of an individual by society or a specific group within it.

Norms

Shared guidelines or unwritten rules that dictate social behavior within a group or society.