Day: May 11, 2023

A good gives rise to external benefits and is produced under conditions of imperfect competition.

Which statement must be true?

Select ONE answer:

1. Consumers of the good are paying too low a price.
2. Firms producing the good will make a loss.
3. Output of the good is below the socially optimum level.
4. Social costs of production exceed private costs.

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct
4. Not correct

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