A Pigouvian Tax Is a Tax Designed to ________

question 204

Multiple Choice

A Pigouvian tax is a tax designed to ________.

• A) induce the consumers of a good to reduce their consumption of the good
• B) induce the producers generating negative externalities to reduce production
• C) induce the producers generating positive externalities to reduce production
• D) force the producers to stop the production of a good in the short run

---

Definitions:

Gothic Style

An architectural style that flourished in Europe during the High and Late Middle Ages, characterized by features such as pointed arches, ribbed vaults, and flying buttresses, emphasizing verticality and light.

Île-de-France

A region in north-central France that encompasses the city of Paris and its surrounding urban and rural areas.

Lombardy

A region in northern Italy known for its rich history, cultural heritage, and economic prosperity, also noted for its significant contributions to the arts and architecture during the Renaissance.

Milan

A global capital of fashion and design, Milan is also recognized for its banking and finance sectors, as well as its rich cultural heritage, including the famous Duomo di Milano.