When a positive externality exists in a market, the distribution of surplus received from a subsidy depends on:
A) how the subsidy is distributed among those affected by the externality.
B) whether those who are affected by the externality receive its true value.
C) where the government obtains the money it uses to pay for the subsidy.
D) None of these are true.
Correct Answer:
Verified
Q110: If the government's provision of a subsidy
Q111: Correcting a market with an externality through
Q112: Pigovian taxes are not always effective because
Q113: The graph shown displays a market with
Q114: When a tax is imposed on a
Q116: If the government were to restrict consumption
Q117: When a quota is imposed on a
Q118: If a Pigovian tax is too large,
Q119: If the government's provision of a subsidy
Q120: The government offers subsidies to offset _
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents