The figure above shows the market for the chemical hydrogen sulfide, the production of which creates an external cost
If the government assesses the marginal external cost correctly, what is the amount of the pollution tax that eliminates the inefficiency? A) $2 per pound
B) $3 per pound
C) $4 per pound
D) $1 per pound
E) None of the above answers is correct.
B
You might also like to view...
Paul runs a shop that sells printers. Paul is a perfect competitor and can sell each printer for a price of $300
The marginal cost of selling one printer a day is $200; the marginal cost of selling a second printer is $250; and the marginal cost of selling a third printer is $350. To maximize his profit, Paul should sell A) one printer a day. B) two printers a day. C) three printers a day. D) more than three printers a day.
Is the distribution of income across different countries in the world equitable? In other words, do all countries share the world's wealth equally?
What will be an ideal response?
The cost of producing one more unit of a good:
a. increasing marginal returns b. total cost c. marginal revenue d. marginal product of labor e. marginal cost
Opportunity cost is defined as
A) the value of the next-best alternative that must be sacrificed to attain a want. B) the least-costly means to produce output. C) the value of the output currently received by an individual or a corporation. D) the return from a given unit of labor.