Homework Help: Econ MC

Posted by Econ on Tuesday, April 17, 2007 at 10:33pm.

Internalizing a positive externality through a government subsidy will cause the industry's supply
curve to
a. remain unchanged.
b. shift down by an amount less than the subsidy.
c. shift down by anamount equal to the subsidy.
d. shift down by an amount greater than the subsidy.

I believe the answer is a)? the supply curve won't change, only demand will change, am i correct?

No. I think the supply curve shifts by the amount of the subsidy.

No one has answered this question yet.

Answer this Question

Related Questions

Economics - Could you please check these thanks. Directions: Supply can decrease...
Microeconomics - Suppose thatsome firms in a perfectly competitive industry are ...
economics - Can you please exlain to me if I'm wrong not just correct me. ps...
externalilties MC - Negative externalities in a market could be internalized if ...
Econ - For a typical negative externality market graph, with Demand curve (also ...
econ - demand and supply - just a few questions that would like to double check ...
microeconomics - Externalities are third party consequence of some other action...
Micro Economics - Externalities are third party consequence of some other action...
Mircoeconomics - A significant difference between monopoly and perfect ...
economics - Which of the following is a FALSE statement? A. Changes in the price...

For Further Reading

First Name:
School Subject:
Answer: