If the marginal external cost of building a children's playground equals zero, then the
A) marginal private cost equals the marginal social cost.
B) marginal social cost equals zero.
C) marginal private cost equals zero.
D) None of the above answers is correct.

Question

Quizplus · Accepted Answer

When the marginal external cost is zero, the marginal private cost equals the marginal social cost because there are no additional external costs to account for.

If the Marginal External Cost of Building a Children's Playground