P ($)Supply1009080706050Socialbenefit40302010Demand0 5 10 15 20 25 30 35 40 45 50Refer to the figure above. If the government wanted to tax or subsidize this good to achieve thesocially-optimal level of output, it wouldSelect one:a. impose a tax of $30 per unit.O b. introduce a subsidy of $30 per unit.c. impose a tax of $50 per unit.d. introduce a subsidy of $50 per unit.

The figure shows that there is a presence of positive externality in the market.

P ($) Supply 100 90 80 70 60 50 Social benefit 40 30 20 10 Demand 0 5 10 15 20 25 30 35 40 45 50 Refer to the figure above. If the government wanted to tax or subsidize this good to achieve th socially-optimal level of output, it would Select one: a. impose a tax of $30 per unit. O b. introduce a subsidy of $30 per unit. C. impose a tax of $50 per unit. d. introduce a subsidy of $50 per unit.

P ($) Supply 100 90 80 70 60 50 Social benefit 40 30 20 10 Demand 0 5 10 15 20 25 30 35 40 45 50 Refer to the figure above. If the government wanted to tax or subsidize this good to achieve th socially-optimal level of output, it would Select one: a. impose a tax of $30 per unit. O b. introduce a subsidy of $30 per unit. C. impose a tax of $50 per unit. d. introduce a subsidy of $50 per unit.

Principles of Macroeconomics (MindTap Course List)

7th Edition

ISBN:9781285165912

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter7: Consumers, Producers, And The Efficiency Of Markets

Section: Chapter Questions

Problem 7PA

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