ToasterOvensInc

question 46

Multiple Choice

ToasterOvensInc. is developing technology to make a toaster oven than uses less electricity. If successful, the technology will significantly reduce the amount of energy that is wasted due to product inefficiencies. If the firm sells only in response to the market price, the quantity shown in the third column is supplied. If the firm were also to receive the broader social benefits of the new technology, the willingness to supply is shown in the fourth column.

If the firm were to receive a price based on both private and social benefits, the equilibrium price and quantity would be

• A) $16, 740
• B) $17, 770
• C) $18, 800
• D) $19, 830

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