Economics 9708 · AS & A Level · 7.4

7.4 — practice question

In 2013, Jaguar-Land Rover introduced a car that could operate on electricity as well as gas (petrol). This would lower harmful emissions by about 14% compared with the next most efficient car. However, it cost more to purchase. What can be concluded if these cars are bought instead of the existing models?

  • APrivate benefits and external costs would rise.
  • BPrivate costs would rise and external costs would fall.
  • CPrivate costs and external costs would fall.
  • DSocial costs would rise.

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