A study finds that the noise from lawn mowers is harmful; hence, the government imposes a $20 tax on the sale of every lawn mower. This amount accurately accounts for the external cost of the noise pollution. Before the corrective tax, basic push mowers regularly sold for $190. After the tax is in place, the market price for basic push mowers rises to $195. The socially optimal price of basic push mowers is _____ $ .
A study finds that the noise from lawn mowers is harmful; hence, the government imposes a $20 tax on the sale of every lawn mower. This amount accurately accounts for the external cost of the noise pollution. Before the corrective tax, basic push mowers regularly sold for $190. After the tax is in place, the market price for basic push mowers rises to $195. The socially optimal price of basic push mowers is _____ $ .
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A study finds that the noise from lawn mowers is harmful; hence, the government imposes a $20 tax on the sale of every lawn mower. This amount accurately accounts for the external cost of the noise pollution. Before the corrective tax, basic push mowers regularly sold for $190. After the tax is in place, the market price for basic push mowers rises to $195.
The socially optimal price of basic push mowers is _____ $ .
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