Suppose That Smoking Creates a Negative Externality

question 409

Multiple Choice

Suppose that smoking creates a negative externality. If the government does not interfere in the cigarette market, then

• A)the equilibrium quantity of cigarettes smoked will equal the socially optimal quantity of cigarettes smoked.
• B)the equilibrium quantity of cigarettes smoked will be greater than the socially optimal quantity of cigarettes smoked.
• C)the equilibrium quantity of cigarettes smoked will be less than the socially optimal quantity of cigarettes smoked.
• D)There is not enough information to answer the question.

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Definitions:

Congressional Representation

The system by which people in the United States elect representatives to the Congress, based on population, to voice their interests and concerns.

Civil War

A war between groups within the same country or state, often characterized by a struggle for power, independence, or social reform.

Black Codes

Laws passed in the Southern states after the Civil War, aimed at restricting African Americans' freedom and compelling them to work in a labor economy based on low wages or debt.

Positions of Servility

Statuses or roles characterized by an excessive willingness to serve or please others, often at one's own expense.