Suppose That Elementary Education Creates a Positive Externality

question 323

Multiple Choice

Suppose that elementary education creates a positive externality. If the government does not subsidize education, then

• A)the equilibrium quantity of education will be equal to the socially optimal quantity of education.
• B)the equilibrium quantity of education will be greater than the socially optimal quantity of education.
• C)the equilibrium quantity of education will be less than the socially optimal quantity of education.
• D)There is not enough information to answer the question.

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