Ask Question
BusinessBusiness
20 May, 17:22

consider in the market for fire extinguishers that there is an external benefit of $10 per extinguisher. What type of externality exists; describe a government policy that would yield a socially efficient outcome?

+3
Answers (1)
  1. 20 May, 19:00
    0
    Answer and Explanation:

    To internalize the externality a government should provide a subsidy equivalent to the additional benefit or externality given by the product.

    So for the external benefit of $10 received by the society, government should give a $10 subsidy to the buyers of fire extinguishers. This shifts the demand curve towards its right giving Optimum.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “consider in the market for fire extinguishers that there is an external benefit of $10 per extinguisher. What type of externality exists; ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers
You Might be Interested in
Imagine that the interest rate on your savings account is 1 percent a year and inflation is 2 percent a year.
Answers (1)
The owner invested $15,200 cash in the company in exchange for its common stock. The company purchased supplies for $550 cash. The owner invested $10,100 of equipment in the company in exchange for more common stock.
Answers (1)
Mongoose Trucking just signed a $3.8 million contract. The contract calls for a payment of $1.1 million today, $1.3 million one year from today, and $1.4 million two years from today. What is this contract worth today at a discount rate of 8.
Answers (1)
Are a family's resources unlimited? true or false?
Answers (2)
Which of the following actions will likely cause a project to fail? A) dedicating valuable team member time to identify risk events B) spending project funding to procure needed tools and spare parts C) unclear or conflicting stakeholder
Answers (1)
New Questions in Business
A high school currently require students to purchase a parking pass in order to park in the parking lot, but for the coming year they are considering letting all students park for free.
Answers (2)
If an entry to adjust depreciation is not recorded at the end of the period, Depreciation Expense on the income statement will be a. overstated. b. understated. c. unaffected because the omitted entry affects two accounts that cancel each other out.
Answers (2)
mktg Sanicare, a manufacturer of hygiene and personal care products, launches a new toothpaste, "Tidy," that claims to be more effective in maintaining oral hygiene than other brands. The advertisements for Tidy provide valid research information.
Answers (1)
An external competitor to Construction (from another island) is offering to build the new homes for $1300 each.
Answers (1)
These lines provide the reader with
Answers (1)
Home » Business » consider in the market for fire extinguishers that there is an external benefit of $10 per extinguisher. What type of externality exists; describe a government policy that would yield a socially efficient outcome?
Sign Up Forgot Password?