Question
Considering the graph below, which of the following statements is correct?
a. The marginal benefit of the positive externality is measured by P3 - P1. b. The marginal cost of the negative externality is measured by P3 - P2. c. The marginal cost of the negative externality is measured by P3 - P1. d. The marginal cost of the negative externality is measured by P3 - P0. Considering the graph below, which of the following statements is correct? The marginal benefit of the positive externality is measured by P3 - P1. The marginal cost of the negative externality is measured by P3 - P2. The marginal cost of the negative externality is measured by P3 - P1. The marginal cost of the negative externality is measured by P3 - P0.
Explanation / Answer
b. The marginal cost of the negative externality is measured by P3 - P2.