When a positive externality is present in a market, total surplus will be _______ if buyers only consider _______ costs.
A)higher; private
B)lower; private
C)lower; social
D)unchanged; social

Question

Quizplus · Accepted Answer

When a positive externality is present, total surplus will be lower if buyers only consider their private costs, because they do not take into account the additional benefits their consumption brings to others, leading to underconsumption of the good or service.

When a Positive Externality Is Present in a Market, Total