Consider a Competitive Market with a MPB = 22 -

question 9

Multiple Choice

Consider a competitive market with a MPB = 22 - q and a MPC = 10 +q.There is a negative production externality of e = q, where q is the level of output in the market, the government can achieve the efficient level of output by:

• A)Implementing a per-unit tax of $4 on suppliers.
• B)Implementing a per-unit tax of $6 on suppliers.
• C)Implementing a per-unit tax of $8 on suppliers.
• D)Implementing a per-unit tax of $10 on suppliers.
• E)None of the above.

---

Definitions:

Lower Costs

The reduction of expenses in the production or procurement of goods or services, often to improve profitability.

High Flexibility

The capability to adapt quickly and effectively to new conditions, changes, or challenges.

Matrix Structure

An organizational structure that combines elements of both functional and project-based structures, facilitating resource sharing and functional expertise.

Horizontal Structure

An organizational layout that emphasizes teamwork and collaboration among departments or teams, with a minimal level of hierarchy.