ncipies 8 Economics Algorithmic End of Chapter Due 011618 a

ncipies 8 Economics : Algorithmic End of Chapter Due 01.16.18 at 11 Attempts: 7. Problems and Applications Q7 Which of the following government activities is motivated by a concern about efficiency? Check all that apply. Regulating cable TV prices Instituting laws against driving while intoxicated Providing some poor people with vouchers that can be used to buy food D D Prohibiting smoking in public places l Imposing higher personal income tax rates on people with higher incomes Breaking up Standard Oil (which once owned 90% of all oil refineries) into several smaller companies because of the increased likelihood of accidents by drunk drivers. Driving while intoxicated creates Accessibility Copyright NoticesTerms of Use Privacy Notice Security Notice

Solution

1.

Correct options:

Regulating cable TV prices

Breaking up standard oil into several smaller companies

Reason: As they will help keep prices under control and ensure general welfare

2.

Externality

Reason: Due to high risk of accidents by drunk drivers, driving under influence creates an added cost on other people on roads.