If the external costs of production are not taken into account, then production will

Name: If the external costs of production are not taken into account, then production will
Brand: Quizplus
Rating: 4.9 (56 reviews)

Question

Quizplus · Accepted Answer

When external costs (i.e. negative externalities) are not taken into account, production tends to be more than socially desirable as the true cost of production is not reflected in the prices. This leads to overproduction and overconsumption, resulting in social inefficiency.

If the External Costs of Production Are Not Taken into Account