The Difference Between Private Cost and Social Cost Is That

question 238

Multiple Choice

The difference between private cost and social cost is that

• A) social cost only considers the external cost borne by society.
• B) social cost only considers the cost borne by people other than the producer.
• C) private cost only considers the cost borne by producers of the good.
• D) social cost also includes any external benefit whereas private cost excludes all external benefits.
• E) there is no difference; the terms refer to the same cost.

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Definitions:

Reduction

The act of making something lesser in size, amount, or degree.

Equals

Signifies that two quantities or expressions have the same value.

Final Value

Refers to the value of an investment or payment at the end of a specified period, accounting for interest or growth.

Fraction

A mathematical expression that represents the division of one quantity by another.