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  3. Study Set
    Economics
  4. Exam
    Exam 31: Market Failure: Externalities, Public Goods, and Asymmetric Information
  5. Question
    If a Positive Externality Exists,__________ for the Socially Optimal Output
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If a Positive Externality Exists,__________ for the Socially Optimal Output

Question 7

Question 7

Multiple Choice

If a positive externality exists,__________ for the socially optimal output to be reached.


A) supply needs to decrease
B) demand needs to increase
C) demand needs to decrease
D) a and c
E) none of the above

Correct Answer:

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