Given below are two statements: Testbook + 2 Assertion (A): In the presence of negative production externalities, the market equilibrium output exceeds the socially optimal output. Reason (R): Marginal Social Cost exceeds Marginal Private Cost at the market equilibrium level. Choose the correct answer:

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Economics · Externalities

Verified Solution4 OptionsUpdated: October 2026👁️1 View

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Both A and R are true and R is the correct explanation of A

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Answer 1

Both A and R are true and R is the correct explanation of A

Answer 2

Both A and R are true but R is not the correct explanation of A

Answer 3

A is true but R is false

Answer 4

A is false but R is true

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