Topic 5 externality solution - DSME1030IJL Topic 5...

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DSME1030IJLTopic 5 externality1. Private costs are those borne by:a.the government.b.the producer of an item.c.both an item's producer and outside parties affected by a negative externality.d.outside parties affected by a negative externality.ANS: BPTS:1REF:94
2. An externality occurs when:PTS:1REF:94
3. Which of the following activities, if any, represents an external cost?PTS:1REF:94
4. Which of the following provides an example of an externality?PTS:1REF:94-96
5. A tax equal to the external cost on firms that emit pollutants would:a.provide firms with the incentive to increase the level of activity creating the pollution.b.provide firms with the incentive to decrease the level of activity creating the pollution.c.provide firms with little incentive to search for less environmentally damaging productionmethods.d.not reduce pollution levels at all.ANS: BPTS:1REF:95
6. To internalize a negative externality:PTS:1REF:95

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Term
Fall
Professor
victor
Tags
Public Good, pts, Externality, REF, Neuromuscular disease

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