Refer to the provided supply and demand graph for a product. In the graph, line S is the current supply of this product, while line S1 is the optimal supply from the society's perspective. This figure suggests that there is (are)
A)external benefits from the production of this product.
B)external costs in the production of this product.
C)currently an underallocation of resources toward producing this product.
D)positive externalities from producing the product.

Question

Refer to the provided supply and demand graph for a product. In the graph, line S is the current supply of this product, while line S1 is the optimal supply from the society's perspective. This figure suggests that there is (are)
A)external benefits from the production of this product. 
B)external costs in the production of this product. 
C)currently an underallocation of resources toward producing this product. 
D)positive externalities from producing the product.

Quizplus · Accepted Answer

The Answer of  Refer to the provided supply and demand graph for a product. In the graph, line S is the current supply of this product, while line S1 is the optimal supply from the society's perspective. This figure suggests that there is (are)
A)external benefits from the production of this product. 
B)external costs in the production of this product. 
C)currently an underallocation of resources toward producing this product. 
D)positive externalities from producing the product.

Refer to the Provided Supply and Demand Graph for a Product