-The Figure Above Represents the Relationship Between Output and Cost

question 14

Multiple Choice

-The figure above represents the relationship between output and cost in an industry with an external cost.Which line represents the marginal private cost (MC) curve?

• A) Curve 1
• B) Curve 2
• C) the dotted line BC
• D) the y-axis
• E) the dotted line AB

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Definitions:

Adam Smith

A Scottish economist and philosopher, considered the father of modern economics, best known for his work "The Wealth of Nations."

Efficient

The characteristic of maximizing output or effectiveness with the least waste of time, resources, or effort.

Opportunities

Chances or circumstances that allow for growth, development, or success in various areas such as business, personal life, or education.

Marginally Optimal

Describes an economic decision where the marginal benefit from the last unit of good or service consumed or produced is equal to its marginal cost.