If There Are Important Spillover Benefits from Consumption of a Good

Multiple Choice

If there are important spillover benefits from consumption of a good,

A) ​government should prohibit its production.
B) ​taxes should be imposed on producers of the product.
C) ​the market demand curve for the good understates the value of the product to society and resources are therefore underallocated to its production.
D) ​the market demand curve for the good overstates the value of the product to society and resources are therefore overallocated to its production.