Use the Figure Below to Answer the Following Questions

question 2

Multiple Choice

Use the figure below to answer the following questions. Figure 15.2.1
-Refer to Figure 15.2.1.The figure shows the marginal private cost curve,the marginal social cost curve and the market demand curve of a mining firm.To promote an efficient allocation of resources,the government could impose a constant per unit tax equal to

• A)P₄.
• B)P₁.
• C)P₃ - P₁.
• D)P₄ - P₁.
• E)P₃ - P₂.

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Definitions:

Franchisor Fee

A payment made by a franchisee to a franchisor, typically for the right to use the franchisor's trademark, operational system, and ongoing support.

Franchises

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Franchising Relationship

A business model that involves a franchisor licensing its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee.