If the Social Benefit Is Greater Than the Private Benefit

question 68

Multiple Choice

If the social benefit is greater than the private benefit in a particular market, then the socially optimal equilibrium will exist at a quantity that is _______ the private level.

• A)greater than
• B)equal to
• C)less than
• D)either greater than or less than

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Definitions:

Maturity Value

The amount payable to the holder of a financial instrument at its maturity date, including principal and any accrued interest.

365-Day Year

A calendar assumption that treats each year as having 365 days for calculating interests or other daily based computations.

Leap Years

Years in which an extra day is added to the calendar (February 29) to keep the calendar year synchronized with the astronomical year.

Interest Computation

The process of calculating the amount of interest earned or paid over a certain period, considering the principal amount, interest rate, and time.