If the Production of a Good Generates External Benefits,the Government

question 73

Multiple Choice

If the production of a good generates external benefits,the government could increase efficiency by

• A) taxing the production of the good to reduce the amount produced.
• B) subsidizing the production of the good to increase the amount produced.
• C) regulating the production of the good to reduce the amount produced.
• D) requiring all producers of the product to be licensed to produce the product.

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Definitions:

Deciduous Forest

A type of forest characterized by trees that lose their leaves seasonally, found in temperate regions that experience warm summers and cold winters.

Pyramid of Biomass

A graphical representation showing the total mass of organisms at each trophic level in an ecosystem.

Nitrogen Fixation

The biological conversion of atmospheric nitrogen into a form (such as ammonia) usable by plants.

Nitrate

A polyatomic ion with the chemical formula NO3- or a compound containing this ion, commonly found in fertilizers, explosives, and natural water sources.