Multiple Choice
If a tax is imposed on externality-producing activities by perfectly competitive firms so that the market is producing the efficient level of output, then
A) P = MSC and MDC = 0.
B) P = MSC and MDC > 0.
C) P = MC and MDC = 0.
D) P = MC and MDC > 0.
Correct Answer:
Verified
Correct Answer:
Verified
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