The marginal principle ________ to private goods with external benefits because ________.
A. does apply; the efficient quantity is that quantity for which the marginal social benefit equals the marginal cost
B. does apply; the efficient quantity is that quantity for which the marginal private benefit equals the marginal cost
C. does not apply; the efficient quantity is a quantity greater than the quantity for which the marginal private benefit equals the marginal cost
D. does not apply; it is a principle that governs private markets with no externalities
Answer: A
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