FIGURE 12-3

-Refer to Figure 12-3, which represents the market for pulp, the production of which creates dioxin emissions. What is the externality per tonne of pulp?
A) $15
B) $25
C) $40
D) $190

Question

FIGURE 12-3
 
-Refer to Figure 12-3, which represents the market for pulp, the production of which creates dioxin emissions. What is the externality per tonne of pulp?
A) $15 
B) $25 
C) $40 
D) $190

Quizplus · Accepted Answer

The externality per tonne of pulp is the difference between the social cost and the private cost. In this context, it is given as $40.

FIGURE 12-3 -Refer to Figure 12-3, Which Represents the Market for Pulp