Consider a good with external costs. Which of the following best describes why the market does not produce an allocatively efficient amount?Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.aThe marginal benefit to consumers exceeds the marginal private cost of production and the marginal social cost of production.bThe marginal social cost exceeds the marginal social benefit.cThe marginal social benefit exceeds the marginal social cost.dThe marginal private cost of production and the marginal social cost exceed the marginal benefit to consumers.

Consider a good with external costs. Which of the following descriptions characterizes quantities of goods between the market equilibrium quantity and the allocatively efficient quantity?Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.aThese quantities will not be produced by the private market, but the government can add these quantities to production using a subsidy, resulting in higher economic efficiency.bThese quantities will not be produced by the private market, but the government can add these quantities to production using a tax, resulting in higher economic efficiency.cThese quantities will be produced by the private market, but the government can eliminate these quantities from production using a subsidy, resulting in higher economic efficiency.dThese quantities will be produced by the private market, but the government can eliminate these quantities from production using a tax, resulting in higher economic efficiency.

Consider a good produced in a competitive market, but one with external benefits. The market price will result in too ______________ of the good for economic efficiency. The market price will be ______________ than the price that would convince producers to produce the efficient amount.Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.alittle; lowerblittle; highercmuch; lowerdmuch; higher

If the marginal cost is zero, how much of a good should be produced?Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.a“as much as possible”b“as much as possible” only if consumers derive any marginal benefit from the goodcthe allocatively efficient quantity of production is zeroddepends on the total cost

Suppose the production of a good in a competitive market has a negative externality. Which of the following is true? a) The social marginal cost curve lies to the left of the market supply curve, and the market equilibrium quantity is less than the allocatively efficient output. b) The social marginal cost curve lies to the left of the market supply curve, and the market equilibrium quantity is at the allocatively efficient output. c) The social marginal cost curve lies to the left of the market supply curve, and the market equilibrium quantity is more than the allocatively efficient output. d) The social marginal cost curve lies to the right of the market supply curve, and the market equilibrium quantity is less than the allocatively efficient output. e) The social marginal cost curve lies to the right of the market supply curve, and the market equilibrium quantity is more than the allocatively efficient output.

The efficient amount of production in a competitive market with external benefits is greater than the equilibrium market quantity.Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer.aTruebFalse