Refer to Scenario 16

question 109

Multiple Choice

Refer to Scenario 16.2 below to answer the question(s) that follow.
SCENARIO 16.2: The marginal benefit for a particular food is described by MB = 60 - q, where q refers to the quantity of the food. The marginal cost of producing the food is described by MC = 3q. There is a negative externality associated with food production and the marginal social cost of food production is MSC = 5q.
-Refer to Scenario 16.2. The competitive output level is ________ and the competitive price is ________.

• A) 20 units of food; $40
• B) 10 units of food; $50
• C) 0 units of food; $0
• D) 10 units of food; $20

---

Definitions:

Stockholders' Equity

The residual interest in the assets of a corporation after deducting liabilities, representing ownership equity in the company.

Cash Dividend

A financial disbursement by a corporation to its stockholders, often as part of the company's profit sharing.

Stock Dividend

A dividend payment made in the form of additional shares rather than cash, increasing the number of outstanding shares.