The Government Can Act to Internalize Externalities by Taxing Goods

question 206

True/False

The government can act to internalize externalities by taxing goods that have negative externalities and subsidizing goods that have positive externalities.

---

Definitions:

Conscious Information

Information of which one is aware and can process and access purposefully.

Nonconscious Information

Information that influences thoughts, feelings, or behaviors without entering conscious awareness.

Direct Inner Awareness

Knowledge of one’s own thoughts, feelings, and memories without the use of sensory organs.

Retinal Disparity

A binocular cue for depth based on the difference in the image cast by an object on the retinas of the eyes as the object moves closer or farther away.