Social Marginal Cost Social Marginal Benefit Quantity Q1 Q2 Q3 Suppose the graph above represents the market for a good with a negative externality. If the private market is left to allocate the good, quantity will be exchanged. The socially optimal quantity is O Q1; Q2. Q3; Q2. O Q2; Q3. Q2; Q1.
Social Marginal Cost Social Marginal Benefit Quantity Q1 Q2 Q3 Suppose the graph above represents the market for a good with a negative externality. If the private market is left to allocate the good, quantity will be exchanged. The socially optimal quantity is O Q1; Q2. Q3; Q2. O Q2; Q3. Q2; Q1.
Chapter1: Making Economics Decisions
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![Social Marginal
Cost
Social Marginal
Benefit
Quantity
Q1
Q2
Q3
Suppose the graph above represents the market for a good with a negative externality. If the private market is left to allocate
the good, quantity
will be exchanged. The socially optimal quantity is
O Q1; Q2.
Q3; Q2.
O Q2; Q3.
Q2; Q1.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff76dba93-23d2-47f1-b92c-ad2c0bf14e16%2Faebf5c7b-94a7-4275-8012-aa514a1fb876%2Fq0a6h90p_processed.png&w=3840&q=75)
Transcribed Image Text:Social Marginal
Cost
Social Marginal
Benefit
Quantity
Q1
Q2
Q3
Suppose the graph above represents the market for a good with a negative externality. If the private market is left to allocate
the good, quantity
will be exchanged. The socially optimal quantity is
O Q1; Q2.
Q3; Q2.
O Q2; Q3.
Q2; Q1.
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