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Business, 06.12.2019 00:31 coolman5999alt

Afew years ago, governor deval patrick of massachusetts proposed that criminals would have to pay a "safety fee" to the government. the size of the fee would be based on the seriousness of the crime (that is, the fee would be larger for more seriouscrimes).  
source: michael levenson, "patrick proposes new fee on criminals," boston
globe,
january 14, 2007.
1) is there an economically efficient amount of crime? briefly explain.
a. yes. the economically efficient amount of crime is where the total social cost equals zero.
b. yes. the economically efficient amount of crime is where the total social benefit equals the total social cost.
c. yes. the economically efficient amount of crime is where the marginal social benefit equals the marginal social cost.
d. yes. the economically efficient amount of crime is where the total social benefit is maximized.
e. no. no amount of crime is efficient.
2) briefly explain whether the "safety fee" is a pigovian tax of the type discussed in this chapter.
a. the safety fee is a pigovian tax because it is designed to make the marginal private cost of crime equal to the marginal private benefit.
b. the safety fee is not a pigovian tax because it is not designed to completely eliminate the externality.
c. the safety fee is not a pigovian tax because it does not treat all crimes equally.
d. the safety fee is a pigovian tax because it is designed to make the marginal private cost of crime equal to the marginal social cost.
e. the safety fee is a pigovian tax because it is designed to raise government revenue.

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