Fixing Externalities: Corrective Taxes, Subsidies, Per-Unit vs Lump-Sum | AP Micro Unit 6

How a per-unit tax equal to the external cost fixes a negative externality, how a per-unit subsidy fixes a positive one, what regulation and tradable permits do, and why a lump-sum tax does not change output. Practice this exact subtopic and get your FRQs graded by AI the way an AP reader would: https://sad-academy.com 0:00 Change one price 0:28 A tax that removes deadweight loss 1:31 A subsidy for a positive externality 2:41 Rules instead of prices 3:20 Per-unit or lump-sum 4:03 Recap Data are hypothetical. Music: "Clean Soul" and "Easy Lemon" by Kevin MacLeod (incompetech.com), licensed under Creative Commons: By Attribution 4.0 http://creativecommons.org/licenses/b... AP® is a registered trademark of College Board, which is not affiliated with and does not endorse this channel.