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Author Question: Taxes and SubsidiesThe graph shows the marginal cost (MC), the marginal benefit (MB), and the ... (Read 446 times)

lingual

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Taxes and Subsidies

The graph shows the marginal cost (MC), the marginal benefit (MB), and the marginal social benefit (MSB) of getting a flu shot.
 
Assume that P1=$1.40, P2=$3.85, P3=$5.85, P4=$8.30, Q1=455 and Q2=740. This illustrates a ________ (negative/positive) externality. The government can achieve economic efficiency by imposing a ________ (subsidy/tax) equal to ________.
◦ negative, subsidy, $6.90
◦ positive, tax, $6.90
◦ negative, tax, $4.45
◦ positive, subsidy, $4.45


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Marked as best answer by lingual on Nov 23, 2022

Htimsrs

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lingual

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Reply 2 on: Nov 23, 2022
Excellent


samiel-sayed

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Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

 

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