The Following Figure Shows the Private Cost and Social Cost

question 181

Multiple Choice

The following figure shows the private cost and social cost of producing Good X.

-Refer to the figure above.Which of the following statements is true in this case?

• A) P₁ is the socially optimal price for Good X.
• B) P₂ is the price of Good X in a free market.
• C) Q₂ units is the efficient level of output of Good X.
• D) Q₂ units is the quantity supplied of Good X in a free market.

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Definitions:

Overstaffed

A situation where there are more employees than necessary within an organization or team, often leading to inefficiency and increased costs.

Understaffed

The situation of having fewer staff members than needed to operate effectively, often leading to increased workload and stress for existing employees.

Overstaffing

The condition of having more employees than necessary, which can lead to reduced efficiency and increased costs.

Divide the Group

A strategy or process of separating a larger group into smaller groups or teams, often to facilitate focus, manageability, or diversity of thought.