Which of the following situations exhibits a positive externality?%0D%0A%0D%0Amultiple choice 1%0D%0AAlan purchases a new watch as a gift for his father.%0D%0ASean spends the afternoon cleaning his garage.%0D%0ARichard renovates a dilapidated historic home in the center of town.%0D%0A%0D%0Ab. When there is a positive externality associated with the market%0D%0A%0D%0Amultiple choice 2%0D%0Atoo little is produced.%0D%0Atoo much is produced.%0D%0Athe socially optimal amount is produced.%0D%0A%0D%0Ac. Governments may stimulate the economy to move toward the socially optimal output by%0D%0A%0D%0Amultiple choice 3%0D%0Ataxing the product.%0D%0Asubsidizing the product.%0D%0Aimplementing a price ceiling