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navik [9.2K]
2 years ago
14

Suppose the government wanted to regulate this market using a price-based instrument. What is the efficient level of a tax on em

issions?
Business
1 answer:
tatiyna2 years ago
3 0

Answer:

Tax = Marginal External Damage

Explanation:

When a negative externality distorts market outcome, we often see that a government intervention is needed. We must incorporate the negative externality into the private decision of the producer. That is to say that we add marginal damage caused by the externality to the marginal private cost of production. The social outcome will be at the point where marginal social cost (MSC) is equal to Marginal private benefit (MPB).

Thus, the efficient level of tax on emission is set equal to the marginal external damage.

Tax = t  = MED

MSC = MPC + MED

        = MPC + t

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Describe the three important trends in the us economy
Dafna11 [192]

Climate Change is the first trend that is expected to cause more natural disasters. This has been facilitated by global warming caused by increased green house gases. Food prices are expected to rise due to high temperatures that has affected corn and soybean. Floods and storms are now becoming unpredictable.

There is high control of oil, gas and food prices by financial markets. Commodities traders are now setting prices instead of supply and demand thus the value of dollar in  under the control of foreign exchange traders.

Increasing rates of interest, where recently the Federal Reserve wants to increase the Fed fund rates to two percent point. Inflation will be at 2% and unemployment at 4% thus this will show <u>a no falling to recession situation</u> which will allow Fed to keep increasing rates.In the long run cost of loans will rise.

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7 0
3 years ago
The elasticity coefficient is determined by looking at the percentage change in quantity divided by the percentage change in pri
krok68 [10]

Answer:

Elasticity coefficient = 0.5

Explanation:

Elasticity coefficient = percentage change in quantity demanded / percentage change in price

percentage change in price if gasoline = 20%

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= 10% / 20%

= 1/2

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5 0
2 years ago
Adam and Alyssa are equal partners in the PartiPilo Partnership. The partners formed the partnership three years ago by contribu
Rina8888 [55]

Answer and Explanation:

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a) Adam receives only money in the distribution and the distribution exceeds his basis.

Particular Amount

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Less: Basis $12,000

Recognized Gain $4,000

b) Adam has $0 remaining basis in his partnership interest due to the fact that all the money or cash he received in the partnership distribution is allocated in outside basis and not within basis.

c) Alyssa has not recognized any gain or loss from the current distribution due to the fact that the cash Alyssa received in distribution is fully adjusted in the outside basis.

d) After adjusting the money received against the outside basis the remaining outside basis of $4,000 will be adjusted by property, which is why Alyssa will assign $4,000 basis to the property.

e)

Particular Amount

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Less: cash distribution $8,000

Less: Property $4,000

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4 0
3 years ago
Which of these is an example of a trade restriction?
Alex787 [66]

Answer:

A tariff on imported cars

Explanation:

5 0
3 years ago
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<u>Answer:</u>

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<em></em>

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