
-The figure above shows the market for milk in Cowland. A subsidy paid to producers of $1 per gallon of milk is introduced. If there are no external costs and no external benefits, the marginal cost of the last gallon of milk produced is
A) $3.00 a gallon.
B) $3.50 a gallon.
C) $4.00 a gallon.
D) $4.50 a gallon.
Correct Answer:
Verified
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