To Reach an Economically Efficient Output Level,the Size of an Excise

question 8

Multiple Choice

To reach an economically efficient output level,the size of an excise tax imposed on a firm generating a negative externality should be

• A)the firm's marginal cost.
• B)the social marginal cost.
• C)the difference between the social marginal cost and the firm's marginal cost.
• D)the sum of the social marginal cost and the firm's marginal cost.

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Definitions:

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Statistical Result

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