A Result of a Positive Externality in the Production of a Good

question 158

Multiple Choice

A result of a positive externality in the production of a good is that

• A) the price system will over-allocate resources to the production of that good or service.
• B) the price system will under-allocate resources to the production of that good or service.
• C) the market supply will be too high.
• D) the market demand will be too high.

Understand the principles of linear programming including decision variables, objective functions, and constraints.

Ability to formulate linear programming models from real-world problems.

Comprehend the importance of resource allocations in production processes.

Analyze and interpret the results of linear programming solutions including shadow prices and slack variables.

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