This figure reflects the market for outdoor concerts in a public park surrounded by residential neighborhoods.
Figure 10-3
-Refer to Figure 10-3. The social cost curve is above the supply curve because
A)it takes into account the external costs imposed on society by the concert.
B)it takes into account the effect of local noise restrictions on concerts in parks surrounded by residential neighborhoods.
C)concert tickets are likely to cost more than the concert actually costs the organizers.
D)residents in the surrounding neighborhoods get to listen to the concert for free.

Question

This figure reflects the market for outdoor concerts in a public park surrounded by residential neighborhoods.
Figure 10-3 
-Refer to Figure 10-3. The social cost curve is above the supply curve because
A)it takes into account the external costs imposed on society by the concert. 
B)it takes into account the effect of local noise restrictions on concerts in parks surrounded by residential neighborhoods. 
C)concert tickets are likely to cost more than the concert actually costs the organizers. 
D)residents in the surrounding neighborhoods get to listen to the concert for free.

Quizplus · Accepted Answer

The social cost curve is above the supply curve because it takes into account the external costs imposed on society by the concert. These external costs could include noise pollution or disturbance to the peace and quiet of the surrounding residential neighborhoods. The supply curve only takes into account the costs and profits relevant to the concert organizers. Therefore, the social cost curve represents a more accurate picture of the true costs of the concert to society as a whole.

This Figure Reflects the Market for Outdoor Concerts in a Public