-In the Figure Above, S Is the Supply Curve and D

question 353

Multiple Choice

-In the figure above, S is the supply curve and D is the demand curve in the unregulated, competitive market for gasoline in Motorland. The external cost of gasoline is constant at $1.50 per gallon. The efficient quantity of gasoline to sell in Motorland is

• A) 1.7 million gallons per month.
• B) 1.8 million gallons per month.
• C) 1.6 million gallons per month.
• D) 1.9 million gallons per month.

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