The marginal social cost of production is the
A) marginal private cost plus the marginal external cost.
B) same as the marginal cost of any externality.
C) total cost of any externality.
D) marginal private cost minus the marginal external cost.
A
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The existence of a positive externality demonstrates that
a. prices are too low b. there are third party costs c. the source is costly to identify d. the value society derives from a good may be greater than the value the person who buys it receives e. benefits are included in price, but not quantity
When the electronics retailer Circuit City closed its stores following the 2008 recession, the market supply of electronic goods:
A. decreased, causing the market price to fall. B. decreased, causing the market price to rise. C. increased, causing the market price to rise. D. increased, causing the market price to fall.