A Negative Externality Such as Pollution Can Be Corrected by

question 54

Multiple Choice

A negative externality such as pollution can be corrected by

• A) a subsidy to producers.
• B) a tax on producers.
• C) a subsidy to consumers.
• D) a stimulus to production.

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Definitions:

Wrongful Acts

Actions or conduct that are unlawful or infringe upon someone's rights.

MRSxy

The marginal rate of substitution (MRSxy) is the rate at which a consumer is willing to trade off one good (x) for another (y) while maintaining the same level of utility.

MUx

Marginal Utility with respect to a good or service x, representing the additional satisfaction gained from consuming one more unit of it.

Px/Py

A ratio indicating the price of one good (Px) relative to the price of another good (Py), used in economics to analyze consumer choice and purchasing power.