If Coal Mining Produces a Negative Externality Because It Leads

Multiple Choice

If coal mining produces a negative externality because it leads to environmental damage, then, at the market equilibrium, the:

A) price of coal will be higher than the socially optimal price.
B) quantity of coal produced will be less than the socially optimal quantity.
C) quantity of coal produced will be greater than the socially optimal quantity.
D) supply curve will lie to the left of the regulated supply curve.