A Properly-Set Pigouvian Subsidy ______ the Price So That the After-Subsidy

question 268

Multiple Choice

A properly-set Pigouvian subsidy ______ the price so that the after-subsidy price sends ______ signal.

• A) raises; the correct
• B) reduces; the correct
• C) raises; an incorrect
• D) reduces; an incorrect

---

Definitions:

Asset's Total Assets

The summation of everything of value owned by a person, company, or organization, including both current and non-current assets.

Stand-alone Risk

The risk associated with a single asset or investment, without considering the asset's interaction or diversification effects within a portfolio.

Coefficient of Variation

A statistical measure of the dispersion of data points in a data series around the mean, used to assess the level of volatility relative to the mean.

Countercyclical

Describes economic policies or activities that move in opposition to the business cycle, aiming to stabilize the economy by reducing fluctuations.