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A-Level Economics · Positive consumption externality diagram question

Which point is the SOCIAL optimum?

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The diagram

The answer

Point F. Where FULL benefit (MSB) meets cost: point F, quantity 7. Count ALL the benefits: MSB crosses S at point F, quantity 7. This is why governments subsidise vaccines.

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This is one of 5 questions on the positive consumption externality diagram — every corner lettered, every wrong answer diagnosed.

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