Question
In: Economics
Aiming at reducing air pollution, the government decided to reduce the country’s use of gasoline by...
Aiming at reducing air pollution, the government decided to reduce the country’s use of gasoline by imposing an $1 tax on each gallon of gasoline sold. Are consumers of gasoline helped or hurt by the tax? (Hint- draw the diagram to see if consumer surplus increases or decreases)
A. Consumer surplus is unchanged
B. Consumers are helped
C. Consumers are hurt
D. Not enough information to conclude
Aiming at reducing air pollution, the government decided to reduce the country’s use of gasoline by imposing an $1 tax on each gallon of gasoline sold.
Briefly explain why the tax on gasoline sold can help reduce air pollution?
Aiming at reducing air pollution, the government decided to reduce the country’s use of gasoline by imposing an $1 tax on each gallon of gasoline sold.
Are producers of gasoline helped or hurt by the tax? (Hint- draw the diagram to see if producer surplus increases or decreases)
| A. |
Producer surplus are unchanged |
|
| B. |
Not enough information to conclude |
|
| C. |
Producers are hurt |
|
| D. |
Producers are helped |
Solutions
Rahul Sunny answered 2 years agoRelated Solutions
Suppose the government decides to raise the gasoline tax as a way of reducing air pollution...
Suppose the government decides to raise the gasoline tax as a way of reducing air pollution and traffic congestion to their optimal levels. Which of the following describes why Pigovian taxes, such as gasoline tax, are unlike most other taxes?
Other taxes are typically used to cover general spending, but funds from corrective taxes can only be used to alleviate pollution
Corrective taxes bring the allocation of resources closer to the social optimum, and thus improve economic efficiency...
Suppose that the federal government has decided that air pollution produced by gasoline should be reduced....
Suppose that the federal government has
decided that air pollution produced by gasoline should be reduced.
To achieve this objective, the federal government is considering
the introduction of an additional tax of 50 cents per litre on
gasoline.
Using a demand and supply diagram illustrate the effect of such
a tax on the price of gasoline. Will the consumers of gasoline or
the producers of gasoline bear the highest tax burden
(incidence)?
Explain under what conditions this policy will be...
Suppose that the federal government has decided that air pollution produced by gasoline should be reduced....
Suppose that the federal government has decided that air
pollution produced by gasoline should be reduced. To achieve this
objective, the federal government is considering the introduction
of an additional tax of 50 cents per litre on gasoline.
Using a demand and supply diagram illustrate the effect of such
a tax on the price of gasoline. Will the consumers of gasoline or
the producers of gasoline bear the highest tax burden
(incidence)?
Explain under what conditions this policy will be...
Suppose that the federal government has decided that air pollution produced by gasoline should be reduced....
Suppose that the federal government has decided that air
pollution produced by gasoline should be reduced. To achieve this
objective, the federal government is considering the introduction
of an additional tax of 50 cents per litre on gasoline. Using a
demand and supply diagram illustrate the effect of such a tax on
the price of gasoline. Will the consumers of gasoline or the
producers of gasoline bear the highest tax burden (incidence)?
Explain under what conditions this policy will be...
4. The congress and the governor decide that they should reduce environmental pollution reducing the use...
4. The congress and the governor decide that they should reduce
environmental pollution reducing the use of gasoline. They impose a
tax of $ 0.10 on each liter of gasoline sold.
a. Should they impose the tax on producers or consumers?
Explain
carefully using supply and demand diagrams. (4 points)
b. If the demand were more elastic, would the tax be more or
less effective?
your purpose of reducing gasoline consumption? Explain using
both text
and diagram. (4 points)
c....
Industrial standards and methods followed for reducing air pollution
Industrial standards and methods followed for reducing air
pollution
An increase in the use of quotas is expected to: A) reduce the country’s current account...
An increase in the use of quotas is expected to:
A) reduce the country’s current account balance, if other
governments do not retaliate.
B) increase the country’s current account balance, if other
governments do not retaliate.
C) have no impact on the country’s current account balance
unless other governments retaliate.
D) increase the volume of a country’s trade with other
countries.
Your friend believes that the government should not try to reduce the pollution amount in companies....
Your friend believes that the government should not try to
reduce the pollution amount in companies. He believes every single
environmental regulation is bad. Write a response (5-8 sentences)
about why it is socially efficient for there to be efforts to
reduce pollution. (Make sure to use some economic terms in your
response).
Suppose China wishes to reduce the amount of air pollution generated by electrical plants. The marginal...
Suppose China wishes to reduce the amount of air pollution
generated by electrical plants. The marginal benefit of electricity
is P = 464, 000 − 200Q and the producers’ marginal cost is P = 32,
000 + 70Q. The air pollution presents a negative externality and
the marginal external cost of each unit is P = 75.6Q.
1. In the market equilibrium, what is the total cost of the
pollution externality?
2. In the socially optimal outcome, what is the...
Economics Two firms are ordered by the federal government to reduce their pollution levels Firm A’s...
Economics
Two firms are ordered by the federal government to
reduce
their pollution levels Firm A’s marginal costs associated with
pollution
reduction is MC=20+4Q and firm B’s MC=10+8Q The marginal benefit of
pollution
reduction is MB=400-4Q
Compare the social efficiency of three possible
outcomes:
require all firms to reduce pollution by the same amount; charge a
common tax
per unit of pollution; or require all firms to reduce pollution by
the same
amount, but allow pollution permits to be bought...
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