If a Pigovian tax is not large enough,the resulting:
A)outcome will not maximize surplus.
B)quantity will be too high.
C)outcome will be inefficient.
D)All of these statements are true.

Question

Quizplus · Accepted Answer

A Pigovian tax is a tax imposed on a negative externality to correct market failures. If the tax is not large enough, the resulting outcome will not maximize surplus, the quantity will be too high, and the outcome will be inefficient.

If a Pigovian Tax Is Not Large Enough,the Resulting