If the social cost of producing a good or service exceeds the private cost

A. a negative externality exists.

B. the market achieves economic efficiency.

C. the sum of consumer surplus and producer surplus is maximized.

D. a positive externality exists.

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Insha FatimaLv10

3 Oct 2020

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MSC- 14) If resources are allocated efficiently, A) consumer surplus exceeds producer surplus. B) marginal social cost is minimized. C) producer surplus exceeds consumer surplus. P) the sum of consumer surplus and producer surplus is maximized, E) marginal social benefit is maximized.

11) It is efficient to produce an additional shirt if the A) producer surplus from the additional shirt exceeds its consumer surplus. B) marginal social benefit from producing the shirt exceeds zero. C) consumer surplus from the additional shirt exceeds its producer surplus. D) marginal social benefit of producing the shirt equals zero. E) marginal social benefit from producing the shirt is greater than the marginal social cost of producing it.

A negative externality or spillover cost (additional social cost) occurs when:

a. all firms fail to achieve productive efficiency.

b. all firms to achieve allocative efficiency.

c. the price of a good exceeds the marginal cost of producing it.

d. the total cost of producing a good exceeds the costs borne by the producer.