Scenario 10-1 The demnd curve for ganoline slopes dowward and the supply curve for gasoline skopes uprard. The production of the 1,000 palon of ganeline entals the following a private cost of $3.10 a social cost of $3-55 . a value to consumers of $3-70 efer to Seenario 10-1 From the given information, it is apparent that a the production of gasoline involves anegative ptemaity, so the market will produce asmaler quanity of ganoline than is socially desiable O the production of gasoline imolves a positive externaliny, so the market will produce a maler quantity of ganoline than is socially desirable Ocoeproduction of gsolne invalves a positive externality, so the market will produce a larger quanoty of gaolne than is socially desiratie. O4 he production of gasoline inolves a negative etemalty, se the market wil produce a larger quartty of ganolne than is socialy desrable
Scenario 10-1 The demnd curve for ganoline slopes dowward and the supply curve for gasoline skopes uprard. The production of the 1,000 palon of ganeline entals the following a private cost of $3.10 a social cost of $3-55 . a value to consumers of $3-70 efer to Seenario 10-1 From the given information, it is apparent that a the production of gasoline involves anegative ptemaity, so the market will produce asmaler quanity of ganoline than is socially desiable O the production of gasoline imolves a positive externaliny, so the market will produce a maler quantity of ganoline than is socially desirable Ocoeproduction of gsolne invalves a positive externality, so the market will produce a larger quanoty of gaolne than is socially desiratie. O4 he production of gasoline inolves a negative etemalty, se the market wil produce a larger quartty of ganolne than is socialy desrable
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