If a Good Has Zero External Costs, Then

question 145

Multiple Choice

If a good has zero external costs, then

• A) marginal social cost equal marginal private cost.
• B) marginal social cost is greater than marginal private cost.
• C) marginal social cost is less than marginal private cost.
• D) we need more information to determine the relationship between private and social costs.

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Definitions:

Co-Ownership

The condition or act of owning something together with one or more parties.

Capital Contributions

Investments made by owners or partners in a business, typically in the form of cash, property, or other assets, to provide funding for the business.

Management

The process of dealing with or controlling things or people within an organization.

Profit

The financial gain that is made when the revenue from business activities exceeds its costs.