When a positive externality exists in a market, total surplus:

A. is the same as a market without a negative externality.
B. is decreased by deadweight loss compared to that same market without a negative externality.
C. is the same but re-distributed differently than if that same market did not have a negative externality.
D. is increased by deadweight gain compared to that same market without a negative externality.


Answer: B

Economics

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