ECONOMICS
- Created by: sabrina2012
- Created on: 23-02-14 11:43
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- TAXATION
- Global Warming can be reduced by taxing the use of fossil fuels.
- There will only be a small reduction of output causing CO2
- Its a tax which is equal to the negative externalities caused by fossil fuels.
- Global Warming can be reduced by taxing the use of fossil fuels.
- This increases the cost of CO2 activities and increases the cost of making the good.
- This reduces output and increases the price of such activities.
- Price reflects; TOTAL COST=PRIVATE COST + NEGATIVE EXTERNALITIES.
- This reduces output and increases the price of such activities.
- Price reflects; TOTAL COST=PRIVATE COST + NEGATIVE EXTERNALITIES.
- They are an incentive for firms to reduce their emissions and consumers behaviour may change, so they may buy products that used less fossil fuels.
- TAXATION
- There will only be a small reduction of output causing CO2
- TAXATION
- There is also a cost of ensuring that firms don't pass the tax to consumers as a higher price.
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