Suppose that there is a negative externality associated with
Alcohol consumption in the United States (e.g., costs of publicly
Funded alcoholism treatment centers).What will happen to the
Social costs of this externality if the United States eliminates all
Tariffs on alcohol imports?
A)The social coasts will increase.
B)They will not change.
C)They will decrease.
D)The social costs will increase but be offset by the private losses associated with increased imports as the tariffs are
Eliminated.

Question

Quizplus · Accepted Answer

Eliminating tariffs on alcohol imports would likely lower the price of alcohol, leading to increased consumption. This would increase the negative externalities associated with alcohol consumption, such as the costs of publicly funded alcoholism treatment centers, thus increasing the social costs.

Suppose That There Is a Negative Externality Associated with