1.

Ronald owns a plant that manufactures fertilizer whose bad smell passes throughout the city. Because the production of fertilizer provides a negative externality to the community, at the market equilibrium quantity, the marginal social:

A)

cost of fertilizer exceeds the market price.

B)

benefit of fertilizer exceeds the market price.

C)

cost of fertilizer is lower than the market price.

D)

benefit of fertilizer is lower than the market price.