Suppose the Actions of the Producers of a Good Generate

question 162

Multiple Choice

Suppose the actions of the producers of a good generate an external benefit which results in the actual market price of $30 and market output of 220 units. How does this outcome compare to the efficient, ideal equilibrium?

• A) The efficient price would higher than $30 while the efficient output would be less than 220 units.
• B) The efficient price would be higher than $30 while the efficient output would be greater than 220 units.
• C) The efficient price would be lower than $30 while the efficient output would be less than 220 units.
• D) The efficient price would be lower than $30 while the efficient output would be greater than 220 units.

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Definitions:

Denitrification

The conversion of nitrate (NO3) to nitrogen gas (N2) by certain bacteria (denitrifying bacteria) in the soil; part of the nitrogen cycle.

Ammonification

The conversion of nitrogen-containing organic compounds to ammonia (NH3) by certain soil bacteria (ammonifying bacteria); part of the nitrogen cycle.

Nitrogen Fixation

The conversion of atmospheric nitrogen (N2) to ammonia (NH3) by certain bacteria; part of the nitrogen cycle.

Ecological Pyramids

Graphical representations showing the relative amounts of energy or matter contained within each trophic level in a given ecosystem.