Scenario 10-1 The Demand Curve for Gasoline Slopes Downward and the Supply

Multiple Choice

Scenario 10-1
The demand curve for gasoline slopes downward and the supply curve for gasoline slopes upward. The production of the 1,000^th gallon of gasoline entails the following:
• a private cost of $3.10;
• a social cost of $3.55;
• a value to consumers of $3.70.
-Refer to Scenario 10-1. Let Q_MARKET represent the equilibrium quantity of gasoline, and let Q_OPTIMUM represent the socially optimal quantity of gasoline. Which of the following inequalities is correct?

A) 1,000 < Q_OPTIMUM < Q_MARKET
B) Q_OPTIMUM < 1,000 < Q_MARKET
C) Q_MARKET < 1,000 < Q_OPTIMUM
D) Q_OPTIMUM < Q_MARKET < 1,000