Economics 9708 · AS & A Level · 7.4

7.4 — practice question

UK supermarkets are able to purchase some vegetables from Kenyan farmers at a lower price than from UK farmers. However, once the environmental harm caused by transporting the vegetables is included, the social costs of UK supermarkets buying Kenyan vegetables are greater than the social costs of buying vegetables grown in the UK. What can be inferred from this information about the purchases made by UK supermarkets?

  • AThe external benefit of buying vegetables from Kenya is higher than buying them from the UK.
  • BThe external cost of buying vegetables from Kenya is higher than buying them from the UK.
  • CThe private cost of buying vegetables from Kenya is higher than buying them from the UK.
  • DThe social cost of buying vegetables from Kenya is lower than buying them from the UK.

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