To increase efficiency,
A)taxes are used to overcome both external benefits and external costs.
B)subsidies are used to overcome both external benefits and external costs.
C)subsidies are used to overcome external benefits, and taxes to overcome external costs.
D)taxes are used to overcome external benefits, and subsidies to overcome external costs.
E)emissions charges are used to overcome external benefits, and vouchers to overcome external costs.

Question

Quizplus · Accepted Answer

Subsidies are used to encourage activities with external benefits, while taxes are used to discourage activities with external costs.

To Increase Efficiency