Microeconomics 1st Edition by Dean Karlan,Jonathan Morduch

Exercise 6

Suppose that the government decides to start regulating use of its forests, charging anyone who wants to log. Which of the following ways of calculating the price to charge for each acre will lead to an efficient quantity of logging?
a. The sum of the marginal social value of each acre to all logging companies.
b. The average price citizens say they would be willing to pay for an acre.
c. The external cost that logging an acre imposes on all citizens.