Question :
51) The deadweight loss associated with producing a product that : 1226056
51) The deadweight loss associated with producing a product that has an external cost occurs because
A) too much output is produced.
B) too little output is produced.
C) the price firms charge for the good is too high.
D) not enough resources are allocated to producing the good.
E) the marginal social cost does not equal zero.
52) When production of a good results in an external cost, the unregulated competitive market equilibrium is inefficient because ________.
A) MSC = MC
B) MSC = MB
C) MSC > MB
D) MSC < MB
E) MSC is undefined
53) For a good whose production creates an external cost, the efficient quantity of output is
A) where the market demand curve and the market supply curve intersect.
B) where the marginal social cost curve and marginal benefit curve intersect.
C) as low as possible.
D) zero.
E) the amount of production so that the marginal social benefit exceeds the marginal social cost by as much as possible.
54) The figure above illustrates the marginal private cost and the marginal social cost to the city of Seattle for each rock concert that is offered. If 5 concerts are put on, then the
A) marginal external cost will be greater than the marginal social cost.
B) marginal external cost will be greater than the marginal private cost.
C) marginal external cost will equal the marginal private cost.
D) marginal social cost will equal the marginal external cost.
E) marginal external cost will equal zero.
55) The figure above illustrates the marginal private cost and the marginal social cost to the city of Seattle for each rock concert that is offered. Suppose the marginal private cost of the 5th concert is $10,000. Then, for the 5th concert, the
A) marginal external cost equals $30,000.
B) marginal social cost equals $30,000.
C) marginal external cost equals the marginal private cost.
D) marginal external cost equals $40,000.
E) marginal external cost equals $10,000.
56) The figure above illustrates the marginal private cost and the marginal social cost to the city of Seattle for each rock concert that is offered. At 10 concerts, the
A) marginal private cost equals the marginal external cost.
B) marginal social cost equals $60,000.
C) marginal private cost is more than $40,000.
D) marginal external cost equals $60,000.
E) marginal external cost equals $80,000.
57) The figure above represents the relationship between output and cost in an industry with an external cost. Which line represents the marginal private cost (MC) curve?
A) Curve 1
B) Curve 2
C) the dotted line BC
D) the y-axis
E) the dotted line AB
58) The figure above represents the relationship between output and cost in an industry with an external cost. When output is at D, what distance represents the marginal external cost?
A) AB
B) BC
C) CD
D) BD
E) None of the above answers is correct.
59) The figure above shows the marginal social cost of generating electricity and the marginal private cost. For 4 billion kilowatts, what is the marginal external cost?
A) $0.12
B) $0.08
C) $0.04
D) $0.00
E) $0.20
