What is social cost
A)a measure of the cost of a negative externality
B)a measure of the loss in profit to the seller as the result of a negative externality
C)a measure of the cost reduction when the negative externality is eliminated
D)a measure of the cost incurred by the government from market intervention

Question

Quizplus · Accepted Answer

Social cost refers to the total cost incurred by society as a result of an economic activity, including both the private cost incurred by producers and the external cost borne by third parties. It is often used to measure the cost of negative externalities, such as pollution or traffic congestion, that are not reflected in the market price of a good or service. Therefore, option A is the best choice.

What Is Social Cost