Economist a Believes That the Case for Government Is a Strong

Multiple Choice

Economist A believes that the case for government is a strong one, but she doesn't always say, when it comes to negative externalities, that government can turn an inefficient market outcome into an efficient outcome.  Which statement is economist A most likely to make?

A) If the tax placed on the activity that generates the negative externality is too large, we are not likely too move from inefficiency to efficiency.
B) If the subsidy placed on the activity that generates the negative externality is too small, we are not likely to move from inefficiency to efficiency.
C) If there is a free rider problem, then government cannot solve the problem of negative externalities.
D) There is not enough information provided to answer this question.