Question 6USBGSEI50 80120 150Consider the market for education. Education has an external benefit. The graph above showsthe supply and demand curves as well as the social benefit curve in the market. Refer to thegraph to answer the following questions:• If the government does not interfere in the functioning of this market, the quantity traded inthe market is• The socially optimal quantity is• The outcome that takes into account the external benefit of education is• In the presence of a positive externality and without government interferproducesketPoint EPoint F◆ compared to the socially optimal quarPoint GPoint HCheckH-- Question 6SBSGBFEII50 80120 150Consider the market for education. Education has an external benefit. The graph above showsthe supply and demand curves as well as the social benefit curve in the market. Refer to thegraph to answer the following questions:• If the government does not interfere in the functioning of this market, the quantity traded inthe market is• The socially optimal quantity is• The outcome that takes into account the external benefit of education is• In the presence of a positive externality and without government interference, the marketproduces ✔compared to the socially optimal quantity.too muchChecktoo littlethe right amountI

Externalities are the side effects which are borne by the parties who are not directly involved in…

P SB E H F III G 50 80 120 150 Consider the market for education. Education has an external benefit. The graph above shows the supply and demand curves as well as the social benefit curve in the market. Refer to the graph to answer the following questions: S

P SB E H F III G 50 80 120 150 Consider the market for education. Education has an external benefit. The graph above shows the supply and demand curves as well as the social benefit curve in the market. Refer to the graph to answer the following questions: S

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Chapter1: Making Economics Decisions

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