alleryStart learning →A negative externality of production exists when what is true?
APrivate cost exceeds social
BSocial cost exceeds private
CFixed cost exceeds variable
DAverage cost is falling
Answer & Solution
Correct answer: B. Social cost exceeds private
Pollution is a cost to others that the firm does not pay, which makes social cost larger than private cost.
Keep practising Production And Cost
Browse all Production And Cost questions for CA Foundation, or explore more Business Economics topics.
Related questions
The marginal cost curve always passes through the minimum points of which two curves?What is the typical shape of the average variable cost curve?Machines and land bought for a factory are generally classed as which cost in the short ruA mill pays a monthly lease whatever it produces. Over the lease period, this payment is wFixed cost is 500. Producing 5 units costs 700 in total and 6 units costs 760. What is theA firm has TFC of 900 and AVC of 15 at 60 units. What is its total cost?At 40 units, TFC is 1,200 and TVC is 800. What is AC at 40 units?TVC is 600 for 50 units. What is the average variable cost?