The figure above shows the marginal social cost curve of gen

The figure above shows the marginal social cost curve of generating electricity and the marginal private cost curve. The marginal cost borne by producers when 200 billion kilowatt hours are produced is

0¢ per kilowatt.

10¢ per kilowatt.

20¢ per kilowatt.

15¢ per kilowatt.

5¢ per kilowatt.

Solution

Solution: 20¢ per kilowatt

Explanation: When 200 billion kilowatt hours are produced marginal cost borne by producers equals 200 / 10 = 20¢ per kilowatt. At 200 billion kilowatt hours the price anc cost of S=MC=10