Figure 10-8
-Refer to Figure 10-8. If the government wanted to tax or subsidize this good to achieve the socially-optimal level of output, it would
A)introduce a subsidy of $2 per unit.
B)impose a tax of $2 per unit.
C)introduce a subsidy of $4 per unit.
D)impose a tax of $4 per unit.

Question

Figure 10-8 
-Refer to Figure 10-8. If the government wanted to tax or subsidize this good to achieve the socially-optimal level of output, it would
A)introduce a subsidy of $2 per unit. 
B)impose a tax of $2 per unit. 
C)introduce a subsidy of $4 per unit. 
D)impose a tax of $4 per unit.

Quizplus · Accepted Answer

The Answer of Figure 10-8 
-Refer to Figure 10-8. If the government wanted to tax or subsidize this good to achieve the socially-optimal level of output, it would
A)introduce a subsidy of $2 per unit. 
B)impose a tax of $2 per unit. 
C)introduce a subsidy of $4 per unit. 
D)impose a tax of $4 per unit.

Figure 10-8 -Refer to Figure 10-8. If the Government Wanted to Tax