Which of the Following Statements Is Correct

question 127

Multiple Choice

Which of the following statements is correct?

• A)Taxes are more difficult to administer than regulations.
• B)Taxes provide incentives for firms to adopt new methods to reduce negative externalities.
• C)Command-and-control policies provide incentives for private decisionmakers to solve their problems on their own.
• D)Corrective taxes distort incentives.

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Definitions:

Prisoners' Dilemma

A scenario in game theory where individuals acting in their own self-interest pursue a course of action that does not result in the optimal outcome for the group.

Cooperative Games

Games in which participants work together to achieve a common goal or derive mutual benefits.

Stackelberg

A model of a market in which one leader firm sets its output first, and then other firms follow, adjusting their outputs accordingly, in strategic game theory.

Cournot Model

A model in oligopoly theory where firms compete on the quantity of output they decide independently and simultaneously.