Explain How Positive Externalities Cause a Wedge Between Private Marginal

Essay

Explain how positive externalities cause a wedge between private marginal costs and social marginal costs.Give an example of a positive externality and explain why it is,in fact,a positive externality.Draw a supply/demand diagram and add a social marginal cost curve that represents the presence of the positive externality.Explain the relationship between the equilibrium quantity and that which is socially efficient.