In a competitive market in which the production of a good causes pollution, the socially optimal output is different from the competitive market equilibrium output of that good because the a. marginal social benefit is higher than the marginal social cost b. marginal social benefit is lower than the marginal private cost c. marginal social cost is higher than the marginal private cost d. marginal social benefit is higher than the marginal private benefit e. total social cost is less than the total social benefit
In a competitive market in which the production of a good causes pollution, the socially optimal output is different from the competitive market equilibrium output of that good because the a. marginal social benefit is higher than the marginal social cost b. marginal social benefit is lower than the marginal private cost c. marginal social cost is higher than the marginal private cost d. marginal social benefit is higher than the marginal private benefit e. total social cost is less than the total social benefit
Chapter14: Environmental Economics
Section: Chapter Questions
Problem 7SQ
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In a competitive market in which the production of a good causes pollution, the socially optimal output is different from the competitive
a. marginal social benefit is higher than the marginal social cost
b. marginal social benefit is lower than the marginal private cost
c. marginal social cost is higher than the marginal private cost
d. marginal social benefit is higher than the marginal private benefit
e. total social cost is less than the total social benefit
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