Author Question: Which of the following will lead to an efficient private solution if negative externalities are ... (Read 29 times)

tiara099 · **on:** Jun 29, 2018

Which of the following will lead to an efficient private solution if negative externalities are present in a market?

A) The party having the legal right is taxed.
B) The party creating the externality has the legal property right.
C) The party suffering from the externality has the legal property right.
D) The parties involved negotiate with each other and reach an agreement.

Question 2

The opportunity cost of producing a unit of consumption at point b in the figure ________ point a.

A) is greater than at
B) is less than at
C) cannot be compared with
D) is the same as