-The Figure Above Shows the Market for a Good with an External

question 116

Multiple Choice

-The figure above shows the market for a good with an external benefit.If the market is competitive and the government takes no action,the equilibrium quantity of ________ units is inefficient because ________.

• A) 8; marginal benefit exceeds marginal cost
• B) 8; marginal cost exceeds marginal benefit
• C) 10; marginal cost exceeds marginal benefit
• D) 10; marginal social benefit exceeds marginal benefit
• E) 10; marginal external benefit exceeds marginal social benefit

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Definitions:

Double-Entry Accounting

An accounting system that records each transaction with equal and opposite effects in at least two different accounts, ensuring accuracy.

Debits and Credits

The fundamental elements of accounting that represent the entries made in accounts to reflect increases or decreases in balances.

Memorized Transactions

Transactions that are saved in the accounting system for future use, allowing for quick recording of recurring expenses, invoices, or payments.

Saved Transactions

Transactions that have been recorded and stored in a financial system for future reference or use.