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Consider a Market Where Production of the Good Is Creating

Question 93

Multiple Choice

Consider a market where production of the good is creating a negative externality.In the market model,there is a difference between the social supply curve and the internal supply curve because the:


A) internal cost is not equal to the external cost.
B) internal cost is not equal to the internal benefit.
C) internal benefit is not equal to the external benefit.
D) social cost is greater than the internal benefit.
E) internal benefit is less than the internal cost.

Correct Answer:

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