Refer to the provided supply and demand graph. S1 and D1 represent the current market supply and demand, respectively. S2 and D2 represent the socially optimal supply and demand. The positions
Of the graphs indicate that there are
A) external beneﬁts from production and external costs from consumption of the product.
B) external costs from production and external beneﬁts from consumption of the product.
C) external beneﬁts from production and consumption of the product.
D) external costs from production and consumption of the product.

Question

Refer to the provided supply and demand graph. S1 and D1 represent the current market supply and demand, respectively. S2 and D2 represent the socially optimal supply and demand. The positions
Of the graphs indicate that there are
A) external beneﬁts from production and external costs from consumption of the product. 
B) external costs from production and external beneﬁts from consumption of the product. 
C) external beneﬁts from production and consumption of the product. 
D) external costs from production and consumption of the product.

Quizplus · Accepted Answer

The Answer of  Refer to the provided supply and demand graph. S1 and D1 represent the current market supply and demand, respectively. S2 and D2 represent the socially optimal supply and demand. The positions
Of the graphs indicate that there are
A) external beneﬁts from production and external costs from consumption of the product. 
B) external costs from production and external beneﬁts from consumption of the product. 
C) external beneﬁts from production and consumption of the product. 
D) external costs from production and consumption of the product.

Refer to the Provided Supply and Demand Graph