When regulating a market in which an externality arises, the government can only command how much of the good companies are allowed to produce.

Question

Quizplus · Accepted Answer

While regulating the market, the government has various options to address externalities such as imposing taxes, subsidies, and creating property rights. It is not limited to commanding the quantity of production.

When Regulating a Market in Which an Externality Arises, the Government