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AP®︎/College Microeconomics

Course: AP®︎/College Microeconomics > Unit 6

Lesson 2: Externalities

Negative externalities
Positive externalities
Externalities: Foundational concepts
Externalities

Externalities

AP.MICRO: POL‑3 (EU), POL‑3.A.1 (EK), POL‑3.A.3 (EK), POL‑3.A.4 (EK), POL‑3.B (LO), POL‑3.B.1 (EK)

The marginal social cost (MSC), marginal private cost (MPC), and marginal social benefit (MSB) associated with the production of a good are shown in this graph.

What is the socially optimal price and quantity in this market?

(Choice A)
P, equals, dollar sign, 28, comma, Q, equals, 24
(Choice B)
P, equals, dollar sign, 20, comma, Q, equals, 20
(Choice C)
P, equals, dollar sign, 20, comma, Q, equals, 36
(Choice D)
P, equals, dollar sign, 16, comma, Q, equals, 28
(Choice E)
P, equals, dollar sign, 12, comma, Q, equals, 20

AP®︎/College Microeconomics

Course: AP®︎/College Microeconomics > Unit 6

Problem