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Discuss whether the following statements are true or false. a) A competitive market with a negative externality produces more output than is efficient b) If

Discuss whether the following statements are true or false.

a) A competitive market with a negative externality produces more output than is efficient

b) If your consumption of cigarettes produces negative externalities for your partner (which you

ignore), then you are consuming more cigarettes than is Pareto-efficient

c) When there are excise duties on cigarettes, then smoking doesn't create an externality anymore

d) A ban on smoking is necessarily efficient

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