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To correct for positive externalities, the government should
A. do nothing, since no harm is done by positive externalities
B. levy a tax on the output of the good or service
C. pay a subsidy equal to the marginal external benefit
D. impose a price ceiling on the good to discourage its production
E. impose a price floor on the good at which the marginal private benefit equals the marginal social cost
Answers: 1
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To correct for positive externalities, the government should
A. do nothing, since no harm is done...
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