(Answered) Figure 1 represents the case of a (an)a. negative externality.d. positive externality.b. pure…

Figure 1 represents the case of a (an)
a. negative externality.
d. positive externality.
b. pure public good.
e. pure private good.
c. common property resource.
f. open access resource.
Given the MSC, MPC, MPB = MSB, and MEC curves in Figure 1, is zero pollution (i.e., Q = 0) socially efficient?
a. No, zero pollution is NOT socially efficient because MPB(0) > MPC(0).
b. No, zero pollution is NOT socially efficient because MSB(0) > MSC(0).
e. Yes, zero pollution is socially efficient because MEC(0) = MSC(0).
f. Yes, zero pollution is socially efficient because MPB(0) > MPC(0).
In Figure 1, the quantity Q1 is
a. socially inefficient because MSB(Q1) = 59 < 85 = MPC(Q1). b. socially inefficient because MPB(Q1) = 59 < 85 = MPC(Q1). c. socially inefficient because MSB(Q1) = 59 < 144 = MSC(Q1). d. cost effective because MEC(Q1) = 59 = MPB(Q1). e. socially inefficient because MSC(Q1) = 144 > 85 = MPC(Q1).
In Figure 1, the competitive market equilibrium quantity, Qc, is Qc = 372 units and the socially efficient quantity, Qε, is Qε = 1102 units.