Multiple Choice
Suppose that elementary education creates a positive externality. If the government does not subsidize education, then
A) the equilibrium quantity of education will be equal to the socially optimal quantity of education.
B) the equilibrium quantity of education will be greater than the socially optimal quantity of education.
C) the equilibrium quantity of education will be less than the socially optimal quantity of education.
D) There is not enough information to answer the question.
Correct Answer:
Verified
Correct Answer:
Verified
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