FIGURE 16-1 -Refer to Figure 16-1.Suppose That the Perfectly Competitive Market with Market

Multiple Choice

FIGURE 16-1
-Refer to Figure 16-1.Suppose that the perfectly competitive market with no government intervention achieves equilibrium at point A.If the social marginal costs and social marginal benefits are represented by MC₀ and MB₁,respectively,then there exists

A) an external benefit.
B) an external cost.
C) an external benefit and an external cost.
D) a social cost that exceeds the private cost.
E) no external benefits or costs.