Use the Figure Below to Answer the Following Questions

question 17

Multiple Choice

Use the figure below to answer the following questions.
Figure 16.2.1
-Refer to Figure 16.2.1.The figure shows the private marginal cost curve,the social marginal cost curve and the market demand curve.If a constant per unit tax is imposed that generates an efficient allocation of resources,then consumers pay a per unit price of

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

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Definitions:

Cognitive Schema

A mental framework that helps organize and interpret information, based on past experiences and knowledge.

Cognitive Heuristic

Simple, efficient rules which people often use to form judgments and make decisions; they are mental shortcuts that reduce the cognitive load of making a decision.

Proposition

A statement or assertion that expresses a judgment or opinion.

Prototype

A typical or standard example of a particular concept or category, often used as a reference point for comparing other items in the same category.