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    Microeconomics Study Set 51
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    Exam 17: Market Failure: Externalities, Public Goods, and Asymmetric Information
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    Exhibit 30-4 ​ Refer to Exhibit 30-4.  If a Negative Externality Exists, Then the Externality
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Exhibit 30-4 ​ Refer to Exhibit 30-4.  If a Negative Externality Exists, Then the Externality

Question 108

Question 108

Multiple Choice

Exhibit 30-4 ​
Exhibit 30-4 ​   Refer to Exhibit 30-4.  If a negative externality exists, then the socially optimal output is A) Q<sub>1</sub>. B) Q<sub>2</sub>. C) Q<sub>1</sub> - Q<sub>2</sub>. D) Q<sub>2</sub> - Q<sub>1</sub>.
Refer to Exhibit 30-4.  If a negative externality exists, then the socially optimal output is


A) Q1.
B) Q2.
C) Q1 - Q2.
D) Q2 - Q1.

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