Answer to Question #264688 in Economics for jeff

Question

A government conducts a cost-benefit analysis into the construction of a new high-speed railway network. The analysis reveals the following information. If it is to build the railway network, the government requires that the net social benefit is more than US$20 billion. What must the external costs be to satisfy the government?

Answer 1

In this case the external costs should be no more than US$20 billion to satisfy the government.