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A few years back, the U.S. federal government wanted to encourage people to purchase new electric vehicles. Government economists determined the marginal external benefit of

A few years back, the U.S. federal government wanted to encourage people to purchase new electric vehicles. Government economists determined the marginal external benefit of a new electric vehicle was $7,500 but did not determine the socially optimal quantity. Which program would do the most to increase electric vehicles purchased by consumers? A tax credit - a form of subsidization - of $7,500 Private bargaining of all potential buyers and sellers of electric vehicles. A quota of 7,500 electric vehicles sold annually Government provision of electric vehicles as a public good

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