Suppose the actions of the producers of a good impose an external cost which results in the actual market price of $18 and market output of 400 units. How does this outcome compare to the efficient, ideal equilibrium?
a. The efficient price would higher than $18 while the efficient output would be less than 400 units.
b. The efficient price would be higher than $18 while the efficient output would be greater than 400 units.
c. The efficient price would be lower than $18 while the efficient output would be less than 400 units.
d. The efficient price would be lower than $18 while the efficient output would be greater than 400 units.
A
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