If there is a positive consumption externality, in a free market the product will then:
A) Be too expensive.
B) Be over-provided compared to the socially optimal level.
C) Be under-provided compared to the socially optimal level.
D) Not be provided in the free market.
Correct Answer:
Verified
Q1: If the Social Marginal Benefit is greater
Q2: Community surplus equals:
A) Producer surplus plus marginal
Q4: The free rider problem occurs:
A) With monopolies
B)
Q5: A merit good:
A) Is one that is
Q6: A monopoly occurs when a firm dominates
Q7: With a negative production externality the amount
Q8: A demerit good:
A) Is one that is
Q9: An example of a demerit good is:
A)
Q10: The free market assumes that:
A) Consumers are
Q11: The extra satisfaction consumers gain from consuming
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