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19) Refer to the figure below. 19 Price per Kilowatt MSCCanada and United States = MPCCanada + MEC Canada and United States Hour ($] PF
19) Refer to the figure below. 19 Price per Kilowatt MSCCanada and United States = MPCCanada + MEC Canada and United States Hour ($] PF MPCCanada Pc MPB Canada = MSB Canada 0 Oc Q of Electricity (kilowatt hours) Canadian Market for Electricity Suppose that electricity production in Canada causes a negative externality that affects both Canada and the U.S. If there is nointernational agreement but there is government intervention in the Canadian market for electricity to achieve the efficient quantity for Canada only (ignoring external costs imposed on the U.S.), what quantity of electricity will be produced? A) QE BJO C) A quantity between Q; and QC D) Qc
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