Ten friends who love to ski decide to pool their financial resources and equally share the cost of a one-week time-share condominium in Banff,Alberta.If lift lines at the ski resort become more congested when these ten additional people start to ski,then which of the following is most likely the case

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An increase in lift ticket prices could be viewed as a Pigovian tax on the externality of congestion. When the ten additional people start skiing, they create a negative externality by increasing the congestion in lift lines, which imposes additional costs on other skiers. Therefore, an increase in lift ticket prices could be used to offset these costs and reduce the negative externality. This is an example of a Pigovian tax, which is a type of tax that is designed to correct for negative externalities. Option A is incorrect because the use of the ski resort by the 10 new skiers does not yield a positive externality, but rather, it leads to congestion and additional costs for other skiers. Option B is also incorrect because the ski resort could take steps to reduce the congestion externality, such as implementing a reservation system or limiting the number of lift tickets sold. Option D is incorrect because although the congestion externality creates additional costs for other skiers, it does not necessarily mean that staying at home would have been a better option.

Ten Friends Who Love to Ski Decide to Pool Their