Question

chicken - pox vaccinations for toddlers benefit society by protecting young children and by preventing a. marginal social benefits of chicken - pox vaccinations exceed the marginal private benefit for any quantity of vaccinations. refer to figure 5 - 10. one way to obtain the economically efficient amount of chicken - pox vaccinations is for vaccinations. what is the size of the per - vaccination pigovian subsidy that the government must provide to
a ( p_e - p_g )
b ( p_e )
c ( p_e - p_d )
d ( p_e - p_h )

Explanation:

A Pigovian subsidy is set to internalize a positive - externality. In the case of chicken - pox vaccinations, the marginal social benefit exceeds the marginal private benefit. The per - vaccination Pigovian subsidy should be set equal to the vertical distance between the marginal social benefit and marginal private benefit curves at the efficient quantity. At the efficient quantity \(Q_E\), this vertical distance is \(P_E - P_P\).

Answer:

A. \(P_E - P_P\)