Economics 9708 · AS & A Level · 7.4

7.4 — practice question

The table presents some of the costs and benefits, in $ millions, connected with a road building project. Both a government department and a profit-maximising private firm are considering whether to construct the road. private costs 450; external costs 75; external benefits 50; social benefits 550 Who would be prepared to build the road?

  • ABoth would be willing to build it.
  • BNeither would be willing to build it.
  • COnly the government department would be willing to build it.
  • DOnly the private firm would be willing to build it.

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