If Positive Externalities Are Present in the Production of a Good

Multiple Choice

If positive externalities are present in the production of a good, what will society do?

A) It will produce too much of the good, since the marginal private benefit to consumers is less than the marginal social benefit.
B) It will produce too little of the good, since the marginal private benefit to consumers is less than the marginal social benefit.
C) It will produce too little of the good, since the marginal private benefit to consumers is greater than the marginal social benefit.
D) It will produce too much of the good, since the marginal private benefit to consumers is greater than the marginal social benefit.