
-The figure above shows the market for pants. If the production of the pants results in an external cost from pollution that is the result of the dye used, then
A) 6 million pairs is the efficient quantity.
B) fewer than 6 million pairs is the efficient quantity.
C) more than 6 million pairs is the efficient quantity.
D) None of the above answers are necessarily correct because more information is needed about the size of the external cost.
E) None of the above answers are correct because it is impossible to tell whether the external cost results in underproduction or overproduction.
Correct Answer:
Verified
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A) is a good that
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Q230: A good or service can be consumed
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Q239: When people cannot be excluded from consuming
Q242: Which of the following occurs when a
Q243: The concept of "the invisible hand" suggests
Q244: When underproduction occurs,
A) producers gain more surplus
Q248: ![]()
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