Governments Can Increase the Consumption of a Product That Creates

question 129

Multiple Choice

Governments can increase the consumption of a product that creates positive externalities by

• A) subsidizing the production of the product so that the supply is increased and market price is reduced.
• B) taxing the production and consumption of the product.
• C) convincing everyone to consume the good.
• D) assigning property rights to the producers of the product.

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Definitions:

Sales Revenue

The total amount of money generated from the sale of goods or services before any costs or expenses are deducted.

Payroll Taxes

Taxes imposed on employers and employees, calculated as a percentage of the salaries that employers pay to their staff.

Current Liability

Financial obligations a company owes and is expected to pay within a year.

Long-term Liability

A debt or obligation not due within the current accounting year, requiring repayment over a longer period.