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When State Regulators Require Consumers to Purchase and Use a Safety

Question 83

Multiple Choice

When state regulators require consumers to purchase and use a safety device,the regulation


A) always reduces total economic surplus.
B) has an ambiguous effect on total economic surplus,depending on whether the regulation infringes on personal liberty.
C) does not reduce total economic surplus if the marginal cost of providing the last device purchased is equal to the marginal social benefit of that device.
D) increases total economic surplus if the government subsidizes the purchase.

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