A Pigovian tax a. is always greater than the social marginal cost of producing a good....
A Pigovian tax
a. is always greater than the social marginal cost of producing a good.
b. is a proportional wealth tax.
c. is a progressive income tax. internalizes the negative externality from producing a good.
d. allows firms to externalize some of the costs of production.
Homework Answers
A Pigovian tax is a tax on any market activity that generates negative externality
option C is correct answer ie. is a progressive income tax. internalizes the negative externality from producing a good.
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A Pigovian tax
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