A government aims to raise the consumption of a merit good and lower the consumption of a demerit good. Which policy ought it to use for each good?
- Amerit good: confine access to certain age groups; demerit good: tax output
- Bmerit good: increase advertising on the benefits of the good; demerit good: set a minimum level of output
- Cmerit good: subsidise the good; demerit good: put legal controls on output
- Dmerit good: tax the good; demerit good: produce only in the public sector