Suppose a state discovered chemical compounds in their water. The source of these chemicals is the waste discharges of industrial plants in another state. This is an example of a(n) :
A) market failure where the market price of the output of these industrial plants does not fully reflect the social cost of producing these goods.
B) external cost imposed by the industrial plants of another state.
C) externality where the marginal social costs of producing these industrial goods differ from the marginal private costs.
D) all of these.
Correct Answer:
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Q2: Negative externalities:
A) are found only in large
Q3: Negative externalities impose most of their costs:
A)
Q4: If some firms internalize their external costs
Q5: To maximize social welfare in the presence
Q6: Recently, the State of Tennessee discovered chemical
Q7: The costs of an economic activity borne
Q8: At the market output and price for
Q9: If firms pollute when they produce:
A) marginal
Q10: Which of the following best describes social
Q12: The socially efficient level of output is
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