If the Marginal Private Cost of Producing One Kilowatt of Power

question 196

Multiple Choice

If the marginal private cost of producing one kilowatt of power in California is ten cents and the marginal social cost of each kilowatt is fourteen cents,then the marginal external cost equals ________ per kilowatt.

• A) ten cents
• B) nineteen cents
• C) four cents
• D) zero cents
• E) fourteen cents

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Definitions:

U.S. Tariff

A tax imposed by the United States government on imports or exports of goods.

Oil

A fossil fuel that is used primarily for energy production and as a raw material in the manufacturing of plastics and other chemicals.

Domestic Quantity

The total amount of a good or service produced within a country's borders and available for consumption or sale in the domestic market.

Supplied

Refers to the amount of a good or service that producers are willing and able to sell at a given price.