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Exhibit 30-5 ​ Refer to Exhibit 30-5.  If a Positive Externality Exists, Then the Externality

Question 53

Multiple Choice

Exhibit 30-5 ​
Exhibit 30-5 ​ Refer to Exhibit 30-5.  If a positive externality exists, then the market ____________ output by the amount ________________. A) underproduces; Q<sub>1</sub> B) overproduces; Q<sub>2</sub> C) overproduces; Q<sub>2</sub> - Q<sub>1</sub> D) underproduces; Q<sub>2</sub> - Q<sub>1</sub>
Refer to Exhibit 30-5.  If a positive externality exists, then the market ____________ output by the amount ________________.


A) underproduces; Q1
B) overproduces; Q2
C) overproduces; Q2 - Q1
D) underproduces; Q2 - Q1

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