Suppose the Production of a Good Results in Negative Externalities

question 35

Multiple Choice

Suppose the production of a good results in negative externalities. If society produces the output consistent with the intersection of the demand curve and the marginal private cost curve, then

• A)the socially optimal level of output will be produced.
• B)society will incur a net social cost.
• C)society will want more output produced, and producers will be willing to satisfy this desire at a price that society deems acceptable.
• D)There is not enough information provided to answer this question.

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Definitions:

Manufacturing Process

The sequence of operations or methods used to convert raw materials into finished goods.

Managers

Managers are individuals responsible for planning, directing, and overseeing the operations and employees within an organization.

Occupancy Rate

A metric used in real estate to show the percentage of rented or used space compared to the total available space.

Guests

Individuals who visit or are invited to a place or event.