If Coal Mining Produces a Negative Externality Because It Leads

question 181

Multiple Choice

If coal mining produces a negative externality because it leads to environmental damage, then, at the market equilibrium, the:

• A)price of coal will be higher than the socially optimal price.
• B)quantity of coal produced will be less than the socially optimal quantity.
• C)quantity of coal produced will be greater than the socially optimal quantity.
• D)supply curve will lie to the left of the regulated supply curve.

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