If a Negative Externality Exists, Then There Is a __________

Multiple Choice

If a negative externality exists, then there is a __________ when society produces the market output instead of the socially optimal output. This exists because the __________ to sellers and third parties are __________ the __________ derived by buyers.

A) net social benefit; costs; greater than; benefits
B) net social cost; benefits; less than; costs
C) net social cost; costs; greater than; benefits
D) net social cost; costs; less than; benefits
E) none of the above