Use the Table Below to Answer the Following Question

question 52

Multiple Choice

Use the table below to answer the following question.
Table 16.2.3

-Refer to Table 16.2.3. The first two columns of the table show the demand schedule for electricity from a coal burning utility; the second and third columns show the utility's cost of producing electricity. The marginal external cost of the pollution created is equal to the marginal cost.
Suppose the government levies a pollution tax such that the utility generates the efficient quantity of electricity. The pollution tax is ________ cents a kilowatt hour.

• A)2
• B)4
• C)6
• D)8
• E)10

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Definitions:

Northern Permafrost

A layer of permanently frozen soil found in the polar regions of the world, notably in the Northern Hemisphere.

Shortage of Water

A situation where the available water supply is insufficient to meet the demands of the population, environment, or economy.

Tropical Forests

Diverse ecosystems located near the equator that experience high average temperatures and significant annual rainfall.

Million Species

A term often referenced in discussions about biodiversity, indicating the vast number of species on Earth, many of which remain unclassified or at risk of extinction.