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United StatesMicroeconomicsQuick questions

Unit 6: Market Failure and the Role of Government

Quick questions on Externalities - AP Microeconomics Topic 6.2

2short Q&A pairs drawn directly from our worked dot-point answer. For full context and worked exam questions, read the parent dot-point page.

What is q1?
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A good generates a positive externality. State whether the market over- or under-produces and the corrective policy. [2 points]
What is q2?
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State the relationship between marginal social cost and marginal private cost for a negative production externality. [1 point]

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