A Consequence of a Negative Externality Is That Social Costs

Multiple Choice

A consequence of a negative externality is that social costs __________ private costs,and the efficient level of output __________.

A) equal; does not require any type of government intervention
B) are less than; requires the government to create a subsidy
C) are greater than; requires the government to impose a tax
D) are greater than; requires the government to create a subsidy
E) are less than; requires the government to impose a tax