In the Presence of an Negative Externality,a Specific Tax Can

question 46

Multiple Choice

In the presence of an negative externality,a specific tax can achieve the social optimum because

• A) output is reduced to zero as a result.
• B) it internalizes the external cost.
• C) it directly charges the producer for polluting.
• D) the price of the good rises by the full amount of the tax.

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Definitions:

Client Confidentiality

The ethical obligation of professionals, especially in law, to keep information related to a client secret and secure.

Attorney-Client Privilege

A legal principle that keeps communications between an attorney and their client confidential, encouraging open and honest discussion.

Threats of Death

The act of implying or directly stating the intention to kill someone, which can be a criminal offense.

Serious Injury

A serious injury is a type of harm that significantly affects a person’s health or ability to perform daily activities, often requiring extensive medical treatment.