Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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- Answer the question on the basis of this table showing the marginal benefit that a particular public project will provide to each of the three members of a community. No vote trading is allowed. Voter Xavier Yoho Zest Marginal Benefit $ 500 200 2,000 If the tax cost of this proposed project is $600 per person, a majority vote will Multiple Choice defeat this project and resources will be overallocated to it. pass this project and resources will be overallocated to it.arrow_forwardCan you give me the solution to this one?arrow_forwardded Answer the question on the basis of this table showing the marginal benefit that a particular public project will provide to each of the three members of a community. No vote trading is allowed. Voter Marginal Benefit Xavier Yoho Zest 1 If the tax cost of this proposed project is $600 per person, a majority vote will Multiple Choice $ 500 200 2,000 O defeat this project and resources will be underallocated to it. defeat this project and resources will be allocated efficiently. pass this project and resources will be overallocated to it. defeat this project and resources will be overallocated to it. SEP 5 ▶ -arrow_forward
- Suppose that you are an economic-policy advisor. Environmental groups are pressuring you toimplement the highest-possible carbon tax, whileindustry groups are pressuring you to implementno carbon tax at all. Both argue that their positionmakes more sense economically. Explain to themwhat the most-efficient tax level will be, and whythere are costs to setting the tax too high or toolowarrow_forwardDon't use chatgpt.....I will 5 upvotes Answer the question based on this table showing the marginal benefit that a particular public project will provide to each of the three members of a community. No vote trading is allowed. \table[[Voter,Marginal Benefit],[Joe,$600arrow_forward. Some dissenting scientists at Environment Canada disagree with the estimate of $1.50 for theenvironmental externality. They believe that the incidence of the externality is not constant acrossdifferent levels of production; instead the size of the externality is proportional to the level of output.That is, the larger is the output, the larger is the externality. Their research suggests that the truesocial cost of cereal production diverges from private costs at every level of production by an amountequal to ten percent of production (note: ten percent, not ten percentage points).The government would like to know the economic effects of implementing a tax to internalise theexternality in this case. Draw the diagram for this market and policy. Solve for all relevant Ps and Qs.Calculate producer surplusarrow_forward
- Assume that the marginal private costs of a film producing fuel-efficient can; is greater than the marginal social costs. Assume that the marginal private benefits of a firm producing fuel efficient cars are the same as the marginal social benefits. Discuss one wags.r that the government cans fly to increase production and sales of fuel efficient cars to the socially desirable amount. Hint: the government is flying to affect production through costs, net benefits.arrow_forwardWhy does a voting cycle make it impossible to decide on a majority-approved choice?arrow_forwardWhat is the main factor preventing a large community from influencing policy in the same way as a special interest group?arrow_forward
- Explain why the federal government funds national defense.arrow_forwardAccording to the Coase theorem,a. private actors can reach agreement to solve theproblem of externalities without the government.b. corrective subsidies are the best policy to solvethe problem of positive externalities.c. negative externalities are a problem for societybut positive externalities are not.d. when two private actors amicably solve theproblem of externalities, they shift the problem toa third partyarrow_forwardPlease see pic attached and awnser this question 2. Show on a diagram how a negative external effect can lead toa situation where marginal social cost will exceed marginalprivate cost at the profit maximising output. Explain briefly howbargaining can lead to an improvement in welfare.arrow_forward
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