Question

Different between private and social cost.. In 20 mark​

Answer 1

Private costs are paid by the firm or consumer and must be included in production and consumption decisions. ... Social costs include both the private costs and any other external costs to society arising from the production or consumption of a good or service. The difference between these two is that private costs are only one part of overall social costs. Social costs take into account not only private costs, but also the externalities that come as a result of a given economic decision. Private costs are the costs with which we are all familiar.