The Rand Corporation estimates that the external costs imposed by alcohol consumption (for example, deaths caused by drunk drivers) to be 48 cents per ounce consumed.Taxes on alcohol amount to 23 cents per ounce consumed.This information suggests: (i) alcohol is overconsumed; (ii) alcohol taxes should be raised.Which of these statements is correct?
A) i and ii
B) i not ii
C) ii not i
D) neither i nor ii
Correct Answer:
Verified
Q102: Figure 15-1 Q103: A local flower grower grows products in Q104: Figure 15-1 Q108: Free market economies Q109: The desirable level of output in a Q110: If P = MC for all goods Q111: Where a firm generates beneficial externalities, society Q111: In a free market where a firm's Q112: In the case of a beneficial externality Q115: Marginal social cost is defined as marginal
A)often have dirty air and
A)marginal
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