Use the following to answer questions:
Figure: Market for Vaccines
-(Figure: Market for Vaccines) Refer to the figure. The figure represents the market for vaccines with external benefits. The market's outcome generates a(n):
A) deadweight loss of approximately $750.
B) shortage of 1,800 vaccines.
C) equilibrium price of $20.
D) All of the answers are correct.

Question

Use the following to answer questions:
Figure: Market for Vaccines 
-(Figure: Market for Vaccines) Refer to the figure. The figure represents the market for vaccines with external benefits. The market's outcome generates a(n):
A) deadweight loss of approximately $750. 
B) shortage of 1,800 vaccines. 
C) equilibrium price of $20. 
D) All of the answers are correct.

Quizplus · Accepted Answer

The deadweight loss occurs because the market fails to account for the external benefits of vaccines, leading to underproduction and underconsumption compared to the socially optimal level.

Use the Following to Answer Questions