Multiple Choice
When an externality is present, the market equilibrium is
A) efficient, and the equilibrium maximizes the total benefit to society as a whole.
B) efficient, but the equilibrium does not maximize the total benefit to society as a whole.
C) inefficient, but the equilibrium maximizes the total benefit to society as a whole.
D) inefficient, and the equilibrium does not maximize the total benefit to society as a whole.
Correct Answer:
Verified
Correct Answer:
Verified
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