Which of the Following Describes How a Positive Externality Affects

question 132

Multiple Choice

Which of the following describes how a positive externality affects a competitive market?

• A)The externality causes a difference between the private benefit from consumption and the social benefit.
• B)The externality causes a difference between the private benefit from production and the social cost of production.
• C)The externality causes quantity demanded to exceed quantity supplied.
• D)The externality causes a difference between the social cost of production and the social cost of consumption.