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liters per week. There is a 30% tax on gasoline, one that also existed prior to the new toll, Assuming that the marginal cost of
liters per week. There is a 30% tax on gasoline, one that also existed prior to the new toll, Assuming that the marginal cost of producing gasoline is $0.5 per liter, that these marginal costs are constant (i.e., the supply schedule is horizontal) and that a $1.3/liter negative externality results from the consumption of gasoline, are there any additional costs or benefits due to this shift? If so, what are they? Carefully explain your reasoning and determine the net annual surplus change of the toll- change policy
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