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Figure 9.8 -Figure 9.8 Depicts a Market for Electricity. Assume Electricity Production

Question 313

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Figure 9.8 -Figure 9.8 depicts a market for electricity. Assume electricity production incurs external costs. If the government imposes a pollution tax in the amount illustrated, the price of a mega-watt of electricity will increase by A) PA - PB. B) PA -PC. C) PB - PC. D) 1/2 PA -PC) . Figure 9.8
-Figure 9.8 depicts a market for electricity. Assume electricity production incurs external costs. If the government imposes a pollution tax in the amount illustrated, the price of a mega-watt of electricity will increase by


A) PA - PB.
B) PA -PC.
C) PB - PC.
D) 1/2 PA -PC) .

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