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    Macroeconomics Study Set 68
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    Exam 4: Market Failures Caused by Externalities Asymmetric Information
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    If Some Activity Creates External Benefits as Well as Private
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If Some Activity Creates External Benefits as Well as Private

Question 71

Question 71

Multiple Choice

If some activity creates external benefits as well as private benefits, then economic theory suggests that the activity ought to be


A) taxed.
B) prohibited.
C) subsidized.
D) left alone.

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