If a good has an external cost, the

a. unregulated competitive market outcome is inefficient.

b. marginal private cost reflects the external cost.

c. unregulated competitive market outcome is efficient.

d. external benefit must equal the external cost.

e. marginal social benefit is equal to the marginal social cost when the market is in equilibrium.

Your take on decision making process

Taking commercial paper means the holder acts honestly

Varto company has 9,400 units of its sole product in inventory that it produced last year at a cost of $23 each. this year’s model is superior to last year’s, and the 9,400 units cannot be sold at last year’s regular selling price of $42 each. varto has two alternatives for these items: (1) they can be sold to a wholesaler for $8 each, or (2) they can be reworked at a cost of $251,100 and then sold for $34 each. prepare an analysis to determine whether varto should sell the products as is or rework them and then sell them.