-The figure above shows the demand curve, the marginal private cost curve and the marginal social cost curve of good A. Production of the 6th unit of output generates a marginal external
A) cost of $3.
B) benefit of $1.50.
C) cost of $6.
D) benefit of $3.

Question

-The figure above shows the demand curve, the marginal private cost curve and the marginal social cost curve of good A. Production of the 6th unit of output generates a marginal external
A) cost of $3. 
B) benefit of $1.50. 
C) cost of $6. 
D) benefit of $3.

Quizplus · Accepted Answer

The marginal external cost is the difference between the marginal social cost and the marginal private cost. The figure (not visible in this format) likely shows that the marginal social cost of producing the 6th unit is $3 higher than the marginal private cost, indicating a marginal external cost of $3.

-The Figure Above Shows the Demand Curve, the Marginal Private