Your state is considering enacting a law requiring that all motorcycle operators and their passengers wear a helmet.Motorcyclists vary in the degree to which they value being able to ride helmet-less and in the extent to which they value the safety provided by a helmet.
If ___ external costs are incurred if a cyclist is involved in an accident,the optimal level of helmet wearing will be ___ provided by private markets.

Question

Quizplus · Accepted Answer

If there are zero external costs, the private market will efficiently provide the optimal level of helmet wearing because individuals will make decisions based on their own safety preferences without affecting others.

Your State Is Considering Enacting a Law Requiring That All