UPSC CDS I 2024 GK Paper

Question : 35 of 120

Marks: +1, -0

Which one of the following statements is not correct?

The market mechanism over- produces a good that generates positive externality.
A cap and trade of pollution permits can be used by the government to achieve the social optimum.
The optimal amount of subsidy in the case of an activity that produces a positive externality is the difference between the social benefit and the private benefit at the optimum.
Tragedy of Commons is an example of negative externality.

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