Which of the following are devices that the government uses to achieve a more efficient allocation of resources in the presence of external benefits?
A) taxes, private subsidies, and regulation
B) public provision, taxes, and private subsidies
C) regulations, public provision, and vouchers
D) vouchers, public provision, and private subsidies
E) public provision, taxes, and vouchers

Question

Quizplus · Accepted Answer

Vouchers, public provision, and private subsidies are all devices that the government can use to achieve a more efficient allocation of resources in the presence of external benefits. Vouchers are a form of subsidy to encourage consumers to consume more of a good with external benefits, public provision ensures that the good is available for those who may not be able to afford it, and private subsidies provide an incentive for producers to supply more of a good with external benefits.

Which of the Following Are Devices That the Government Uses