Economics 9708 · AS & A Level · 7.4

7.4 — practice question

Constructing a hospital involves a social cost of $200 million. The social benefit amounts to $240 million; the external benefit is $150 million. What can be concluded from this information?

  • Aexternal benefit is greater than external cost
  • Bexternal benefit is greater than private benefit
  • Cprivate benefit is greater than private cost
  • Dthe project should not take place

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