Refer to the graph shown, which shows the demand and supply for a new vaccine against the common cold. Once vaccinated, a person cannot catch a cold or give a cold to someone else. If government does not subsidize the production of this vaccine:
A. the number of workers hired to produce the vaccine will be less than the socially efficient level.
B. the vaccine will be overproduced because consumers will not take into account the fact that many of their neighbors and co-workers will consume the vaccine.
C. the firm producing the vaccine will use too much capital in producing the vaccine.
D. no positive externality can be created.
Answer: A
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