Figure 10-20.
-Refer to Figure 10-20. The graph depicts the market for fertilizer. This market would benefit from a
A)subsidy on fertilizer equal to $100.
B)tax on fertilizer equal to $100.
C)tax on fertilizer equal to $50.
D)subsidy on fertilizer equal to $50.

Question

​Figure 10-20. ​ 
-Refer to Figure 10-20. The graph depicts the market for fertilizer. This market would benefit from a
A)subsidy on fertilizer equal to $100. 
B)tax on fertilizer equal to $100. 
C)tax on fertilizer equal to $50. 
D)subsidy on fertilizer equal to $50.

Quizplus · Accepted Answer

A tax on fertilizer equal to $100 would likely address a negative externality associated with fertilizer use, such as environmental damage, by internalizing the external cost.

​Figure 10-20. ​

Figure 10-20.