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Refer to the Provided Supply and Demand Graph for a Public

Question 227

Multiple Choice

  Refer to the provided supply and demand graph for a public good. If Q1 units of the public good are produced, then A)  users are willing to pay more for the public good than it costs to produce it. B)  users are willing to pay less for the public good than it costs to produce it. C)  there is an overallocation of resources toward producing this public good. D)  allocative efficiency is achieved in the market. Refer to the provided supply and demand graph for a public good. If Q1 units of the public good are produced, then


A) users are willing to pay more for the public good than it costs to produce it.
B) users are willing to pay less for the public good than it costs to produce it.
C) there is an overallocation of resources toward producing this public good.
D) allocative efficiency is achieved in the market.

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