Based on the figure above,if the factory owned the river then at the equilibrium,marginal social cost would ________ marginal benefit,and the quantity of chemical produced would be ________.
A) exceed; above the efficient quantity
B) exceed; below the efficient quantity
C) be below; above the efficient quantity
D) be below; below the efficient quantity
E) equal; efficient

Question

Quizplus · Accepted Answer

If the factory owned the river, it would internalize the external costs, leading to a situation where marginal social cost equals marginal benefit, resulting in an efficient quantity of chemical production.

Based on the Figure Above,if the Factory Owned the River