Which of the following is TRUE?
A)private cost + average cost = social cost
B)social cost = private cost + external cost (True Answer )Correct
C)external cost = private cost
D)private cost + social cost = external cost

Question

Quizplus · Accepted Answer

Social cost includes both private cost (cost borne by producer) and external cost (cost borne by society as a whole). Therefore, the equation that represents social cost is social cost = private cost + external cost.

Which of the Following Is TRUE