Suppose the Production of a Good Results in Negative Externalities

question 41

Multiple Choice

Suppose the production of a good results in negative externalities. If output is at the intersection of the demand curve and the marginal social 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 less 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 the question.

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Definitions:

Population

The total number of people inhabiting a particular area or country, including their demographics, distribution, and density.

Infant Mortality Rate

The statistical measure of the number of deaths of infants under one year of age per 1,000 live births.

Live-born Children

Infants who exhibit any sign of life, such as breathing, heartbeat, or voluntary muscle movement, after delivery, regardless of gestational age.

Health Risks

Refer to potential factors or behaviors that can have a negative impact on an individual's health.