Suppose That Elementary Education Creates a Positive Externality

question 99

Multiple Choice

Suppose that elementary education creates a positive externality. If the government subsidizes education by an amount equal to the per-unit externality it creates, then

• A)the equilibrium quantity of education will equal 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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Definitions:

Start-Up Process Model

A framework outlining the step-by-step progression needed to establish a new business, from idea conception to market entry.

Environmental Factors

Forces that occur outside of the business that affect the business and its owner.

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The process of organizing, planning, leading, and controlling resources to achieve specific goals.