When government provides a good with an external benefit, to attain efficiency the price paid by consumers is set equal to the
A) marginal private benefit at the efficient level of output.
B) marginal private cost at the efficient level of output.
C) amount paid by taxpayers.
D) market-determined price.
E) marginal external benefit at the efficient level of output.
A
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When the marginal social benefit of Good A is greater than the marginal private benefit of Good A, then
A) competitive, unregulated markets will produce a quantity of Good A that is less than the efficient quantity. B) competitive, unregulated markets will produce the quantity of Good A that is equal to the efficient quantity. C) competitive, unregulated markets will produce a quantity of Good A that is greater than the efficient quantity. D) the government should levy a tax on the production of Good A that is equal to the horizontal distance between the two marginal cost curves.
An increase in a firm's fixed cost will not change the firm's profit-maximizing output in the short run
Indicate whether the statement is true or false