10, Dec 2020
negative production externality

Which of the following scenarios could describe a market experiencing a negative production externality?

A. Optimal social quantity will be less than the private unregulated quantity, and the optimal social price will be greater than the private price.

B. Optimal social quantity will equal private quantity, and social price will equal private price.

C. Optimal social quantity will be less than the private unregulated quantity, and social price will be less than private price.

D. Optimal social quantity will be greater than the private unregulated quantity, and social price will be less than private price.

E. Optimal social quantity will be greater than the private unregulated quantity, and social price will be greater than private price.