Refer to Figure 5-1. If, because of an externality, the economically efficient output is Q2 and not the current equilibrium output of Q1, what does S2 represent?
A) the market supply curve reflecting marginal social cost
B) the market supply curve reflecting implicit cost
C) the market supply curve reflecting marginal private cost
D) the market supply curve reflecting external cost
A
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Indicate whether the statement is true or false
The long-run supply curve of a market for eggs is perfectly inelastic
Indicate whether the statement is true or false
Which of the following would most likely cause the supply of wheat to increase?
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