One Way to Make Consumers Take a Negative Externality into Account

question 123

Multiple Choice

One way to make consumers take a negative externality into account in their demand decision is to:

• A) place a tax on the item.
• B) subsidize the purchase of the item.
• C) give suppliers a production credit.
• D) None of these statements is true.

Describe the moral philosophy of utilitarianism and its relation to capitalism.

Discuss the potential benefits of social responsibility for Internet and e-commerce companies.

Identify and exemplify unethical competitive behaviors in business.

Explain the concept of cause marketing and its impact on consumer behavior.

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Definitions:

Ambrosia

In classical mythology, is the food of the gods, believed to confer immortality; in modern contexts, it can refer to something very pleasing to taste or smell.

Bubble Gum

A type of chewing gum that is designed to be more elastic so that it can be blown into bubbles by the chewer.

Utility Function

A mathematical representation of how consumers rank different bundles of goods based on the satisfaction or utility those goods provide.

Indifference Curve

A graphical representation of different bundles of goods between which a consumer is indifferent, showing the combinations of two goods that give the consumer the same level of satisfaction.