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Aplia Homework: Externalities and the Environment According to the graph, if the government does not intervene in the market for gasoline, the equilibrium price of a gallon of gasoline will be |$ and drivers will buy million gallons. Which of the following statements correctly describe(s) the market for gasoline? Check all that apply. Society prefers more gasoline than the market outcome of gasoline being produced. The market outcome is not socially efficient. At the market quantity, the marginal private cost of gasoline exceeds the market price. The marginal social cost of gasoline is greater than the marginal private cost. Suppose that government regulators try to deal with the pollution externalities by imposing a binding limit on the quantity of gasoline that can be sold. Together, producers in this market can sell a maximum of 8 million gallons. This intervention correct the pollution externality. Now, suppose that the government decides not to use quantity limits. Instead, it imposes a tax on gasoline. According to the previous graph, in order to achieve the efficient quantity of gasoline, the government should impose a tax of $ per gallon. Both the tax and the quantity restriction policy are solutions to overpollution. Based on the previous graph, which policy is more successful in ensuring that the efficient quantity of gasoline is consumed, and that the people who consume it are those who derive the most value from it? The quantity restriction system Both policies are equally successful