The diagram below shows the supply and demand diagrams for the competitive market for honey in one region.MC₀ represents private marginal cost and MB₀ represents private marginal benefit. FIGURE 16-3
-Refer to Figure 16-3.Assume there are two types of firms in this region - beekeepers that produce honey and orchard keepers that produce peaches.The bees provide a benefit to the orchard keepers by pollinating their peach trees.We can say that there is a ________ externality in the production of honey.The curve ________ represents the ________ marginal benefit of honey.

Question

The diagram below shows the supply and demand diagrams for the competitive market for honey in one region.MC₀ represents private marginal cost and MB₀ represents private marginal benefit.

The diagram below shows the supply and demand diagrams for the competitive market for honey in one region.MC<sub>0</sub> represents private marginal cost and MB<sub>0</sub> represents private marginal benefit. FIGURE 16-3 -Refer to Figure 16-3.Assume there are two types of firms in this region - beekeepers that produce honey and orchard keepers that produce peaches.The bees provide a benefit to the orchard keepers by pollinating their peach trees.We can say that there is a ________ externality in the production of honey.The curve ________ represents the ________ marginal benefit of honey. A) positive; MB<sub>1</sub>; social B) negative; MB<sub>1</sub>; private C) negative; MB<sub>2</sub>; social D) positive; MB<sub>2</sub>; social E) positive; MB<sub>2</sub>; private

FIGURE 16-3
-Refer to Figure 16-3.Assume there are two types of firms in this region - beekeepers that produce honey and orchard keepers that produce peaches.The bees provide a benefit to the orchard keepers by pollinating their peach trees.We can say that there is a ________ externality in the production of honey.The curve ________ represents the ________ marginal benefit of honey.

Quizplus · Accepted Answer

The bees provide a benefit to the orchard keepers by pollinating their peach trees. This is a positive externality in the production of honey. The curve MB2 represents the social marginal benefit of honey, which is the sum of the private marginal benefit (MB1) and the external marginal benefit.

The Diagram Below Shows the Supply and Demand Diagrams for the Competitive