A chemical plant is located close to a river and the residue from the plant sometimes drains into that river. Although this act of polluting the river is not taken into account by the firm, this negative externality results in: Question 13 Answer a. The firm's social costs exceeding the firm's private costs b. The firm's social marginal costs exceeding the firm's private marginal costs c. The firm's private marginal costs exceeding the firm's social marginal costs d. The firm's private costs exceeding the firm's social costs