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If All Firms Had to Bear All the Social Costs

Question 123

Multiple Choice

If all firms had to bear all the social costs of their actions, we should observe marginal cost curves


A) of all firms shifting up.
B) of some firms shifting up, of some others shifting down, and of the rest not shifting at all.
C) of all firms that had generated externalities shifting up while there would be no change for the rest of the firms.
D) of some firms shifting up and of the rest shifting down.

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