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FIGURE 12-3 -Refer to Figure 12-3, Which Represents the Market for Pulp

question 3

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FIGURE 12-3
FIGURE 12-3 -Refer to Figure 12-3, which represents the market for pulp, the production of which creates dioxin emissions. Suppose the market is currently producing at the profit maximizing point and the government wishes to impose a tax to correct the overallocation of resources caused by the externality. What per unit tax would accomplish this goal? A) $15 B) $25 C) $40 D) $190
-Refer to Figure 12-3, which represents the market for pulp, the production of which creates dioxin emissions. Suppose the market is currently producing at the profit maximizing point and the government wishes to impose a tax to correct the overallocation of resources caused by the externality. What per unit tax would accomplish this goal?

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