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The Following Data Show the Relationship Between the Number of Drivers

Question 98

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The following data show the relationship between the number of drivers who leave for work at 8:00 am,their average commute times,and their marginal benefit associated with the commute times.  Number of drivers  that leave at 8:00am  Average commute  time to downtown  Marginal  Benefit 10030 minutes $1020065 minutes $8300110 minutes $4400170 minutes $3500260 minutes $1\begin{array} { c c c } \begin{array} { c } \text { Number of drivers } \\\underline { \text { that leave at 8:00am }}\end{array} & \begin{array} { c } \text { Average commute } \\\underline { \text { time to downtown }}\end{array} & \begin{array} { c } \text { Marginal } \\\underline { \text { Benefit }}\end{array} \\ 100 & 30 \text { minutes } & \$ 10 \\200 & 65 \text { minutes } & \$ 8 \\300 & 110 \text { minutes } & \$ 4 \\400 & 170 \text { minutes } & \$ 3 \\500 & 260 \text { minutes } & \$ 1\end{array}
Refer to the information given above.An argument for imposition of a toll rather than using a negotiated solution of the type suggested by the Coase Theorem is that:


A) this is not an externality problem.
B) government needs additional revenues.
C) the external cost is not well defined.
D) private negotiations among 500 drivers is impractical.

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