When a Quota Is Imposed on a Market with a Negative

Multiple Choice

When a quota is imposed on a market with a negative externality, the market is:

A) efficient, because consumption occurs at the efficient level.
B) not efficient, because the net benefits individuals receive from the amount set by the quota are different.
C) efficient, because the net benefits individuals receive from the amount set by the quota are equal.
D) not efficient, because the marginal cost outweighs the marginal benefit for too many consumers.