In the Absence of Government Interference, There Is a Constant

question 17

Multiple Choice

In the absence of government interference, there is a constant marginal cost of $5 per ounce for growing marijuana and delivering it to buyers.If the probability that any shipment of marijuana is seized is .10 and the fine if a shipper is caught is $45 per ounce, then the equilibrium price of marijuana per ounce is

• A)$50.
• B)$9.50.
• C)$10.56.
• D)$4.50.
• E)$5.50.

---

Definitions:

Needy Families

Households with insufficient income or resources to meet basic living expenses.

Supplemental Security Income

A United States government program that provides financial aid to elderly, blind, or disabled individuals with little or no income to help them meet basic needs for food, clothing, and shelter.

Negative Income Tax

is a proposed system of income support that involves the government providing financial assistance to individuals earning below a certain threshold.

Tax Liability

The total amount of tax that an individual, corporation, or other entity is obligated to pay to tax authorities, based on income, property value, or other taxable attributes.