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When the Production of a Good Has an External Cost,the

Question 106

Multiple Choice

When the production of a good has an external cost,the


A) marginal social cost curve lies below the marginal private cost curve.
B) marginal social benefit curve lies above the marginal private benefit curve.
C) equilibrium quantity in an unregulated, competitive market has a marginal social cost greater than the marginal social benefit.
D) equilibrium quantity in an unregulated, competitive market has a marginal social cost less than the marginal social benefit.
E) none of the above.

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