Table 10-2 the Following Table Shows the Private Value, Private Cost, and Cost

question 454

Multiple Choice

Table 10-2
The following table shows the private value, private cost, and social value for a market with a positive externality.
-Refer to Table 10-2. What is the socially-optimal level of output in this market?

• A)3 units
• B)4 units
• C)5 units
• D)6 units

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Definitions:

Recessions

Phases of short-term economic downturn characterized by decreased commerce and manufacturing, typically marked by a reduction in Gross Domestic Product (GDP) for two consecutive quarters.

Interest Rates

The cost of borrowing or the reward for saving, often expressed as a percentage of the principal amount per annum.

Factories

Large buildings or complexes where goods are manufactured or assembled predominantly by machines and workers.

Equipment

The set of tools, machinery, and other apparatus necessary for the manufacture of goods or the provision of services, often considered as part of capital investment in economic analyses.