Confusing Economics Question about Supply and Demand. Help Greatly Appreciated!
I'm very confused about this homework question I have and was hoping someone could help or at least provide some insight!
The forces of supply and demand will provide a quantity that is
A) less than the efficient quantity if a good generates external benefits.
B) more than the efficient quantity if a good generates external benefits.
C) exactly the efficient quantity if a good generates external benefits.
D) either more than or less than the efficient quantity if a good generates external benefits. It is impossible to know whether it will be too much or too little without more information.
I'm very confused about this homework question I have and was hoping someone could help or at least provide some insight!
The forces of supply and demand will provide a quantity that is
A) less than the efficient quantity if a good generates external benefits.
B) more than the efficient quantity if a good generates external benefits.
C) exactly the efficient quantity if a good generates external benefits.
D) either more than or less than the efficient quantity if a good generates external benefits. It is impossible to know whether it will be too much or too little without more information.
Last edited: