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Consider a Competitive Market in Which the MPB = 180

Question 2

Multiple Choice

Consider a competitive market in which the MPB = 180 - 2q and the MSC = q.In this market, however, there is a positive consumption externality of $60 per unit consumed.What is the efficient level of output in this market?


A) 60
B) 70
C) 80
D) 90
E) 100

Correct Answer:

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