Steel production creates pollution. If a tax is imposed on steel production equal to the marginal external

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Steel production creates pollution. If a tax is imposed on steel production equal to the marginal external cost of the pollution it creates, ______.
A. Steel producers will cut pollution to zero.
B. The deadweight loss created by steel producers will be cut to zero.
C. The market price of steel will rise by the amount of the tax.
D. Steel producers will continue to produce the inefficient quantity of steel.

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Foundations Of Economics

ISBN: 9780135897478

9th Edition

Authors: Robin Bade, Michael Parkin

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