Use the figure below to answer the following questions. Figure 15.2.2
-Refer to Figure 15.2.2.This figure shows the demand curve,the marginal private cost curve and the marginal social cost curve of good A.Production of the 6th unit of output generates a marginal external
A)cost of $1.50.
B)cost of $3.
C)cost of $6.
D)benefit of $3.
E)cost of $9.

Question

Use the figure below to answer the following questions.  Figure 15.2.2
-Refer to Figure 15.2.2.This figure shows the demand curve,the marginal private cost curve and the marginal social cost curve of good A.Production of the 6th unit of output generates a marginal external
A)cost of $1.50. 
B)cost of $3. 
C)cost of $6. 
D)benefit of $3. 
E)cost of $9.

Quizplus · Accepted Answer

The marginal external cost is the difference between the marginal social cost and the marginal private cost. If the marginal social cost is $3 higher than the marginal private cost for the 6th unit, then the marginal external cost is $3.

Use the Figure Below to Answer the Following Questions