If marginal social benefit is greater than marginal private benefit, then
A. market exchange will not work.
B. a subsidy must be provided to correct the market.
C. an external benefit must exist.
D. there is an overproduction.
Answer:C
If marginal social benefit is greater than marginal private benefit, then
A. market exchange will not work. B. a subsidy must be provided to correct the market. C. an external benefit must exist. D. there is an overproduction.