Figure: Negative Externalities and Raising Pigs for Pork (Figure

question 86

Multiple Choice

Figure: Negative Externalities and Raising Pigs for Pork (Figure: Negative Externalities and Raising Pigs for Pork) Refer to the figure Negative Externalities and Raising Pigs for Pork.If the socially optimal production of pigs is 200, the government could achieve the socially optimal production by imposing a Pigouvian tax of:

• A)$400.
• B)$300.
• C)$250.
• D)$200.

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Definitions:

Shares

Units of ownership in a company or financial asset that give shareholders a portion of the corporation's assets and profits.

Capital Gain

The increase in value of an asset or investment above its purchase price, often realized upon sale of the asset.

Total Return

The complete return on an investment over a given time period, including both capital gains and dividends or interest, expressed as a percentage of the initial investment cost.

Dividends

Payments made by a corporation to its shareholder members as a distribution of profits.