In a certain industry the regulators argue for a tax to curb the negative externality of a
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In a certain industry the regulators argue for a tax to curb the negative externality of a steel production at a steel mill. The tax is basically a surcharge for each ton of steel produced. As it alters the cost structure of production the imposition of the tax reduces steel production. The tax revenue is collected by the government. Common sense and economic efficiency arguments imply that the tax revenue be used
A. to enhance border security in the United States.
B. to increase the amount of foreign aid given to countries in South America.
C. to advance the fight against world hunger.
D. to help cover the costs of those impacted by the negative externality from steel production; or to clean up the pollution.
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