The figure shows the marginal private cost curve, marginal social cost curve, and marginal social benefit curve for raising goats on a common pasture. Suppose the government assigns individual transferable quotas (ITQ) set to achieve the efficient outcome. The market price of an ITQ is, per pound. OA. $4.20 B. $2.00 C. $6.00 D. $4.00 E. $0.00

Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter13: Positive Externalities And Public Goods
Section: Chapter Questions
Problem 24P: Assume that the marginal private costs of a film producing fuel-efficient can; is greater than the...
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6
Price and cost (dollars per pound)
8
7
5
4
3
2
-
O
10 20
30
MSC
MC
MSB
60
Number of goats
40 50
Transcribed Image Text:6 Price and cost (dollars per pound) 8 7 5 4 3 2 - O 10 20 30 MSC MC MSB 60 Number of goats 40 50
The figure shows the marginal private cost curve, marginal social cost curve, and marginal social benefit
curve for raising goats on a common pasture. Suppose the government assigns individual transferable
quotas (ITQ) set to achieve the efficient outcome. The market price of an ITQ is
për pound.
A. $4.20
B. $2.00
C. $6.00
D. $4.00
OE. $0.00
OOO
Transcribed Image Text:The figure shows the marginal private cost curve, marginal social cost curve, and marginal social benefit curve for raising goats on a common pasture. Suppose the government assigns individual transferable quotas (ITQ) set to achieve the efficient outcome. The market price of an ITQ is për pound. A. $4.20 B. $2.00 C. $6.00 D. $4.00 OE. $0.00 OOO
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