1. All the curves are correctly plotted in the question.
10. We know that the net benefit is more in case of perfect competition as compared to the monopoly. This is because there is no dead weight loss in case of perfect competition. On the other hand, there is welfare loss involved in case of monopoly.
Now, the net benefit will be lower when the externalities (say external cost in this case) has been included. This is because when we include the social or external cost, the cost curve becomes higher and this will obviously lead to lesser net benefit as higher costs will be a reduction in welfare of the producer as well as consumer.
Hence, the given options can be ranked in the form of higher net benefit to lower net benefit in the following way:
i. Perfect competition with external cost not internalized.
ii. Perfect competition with external cost internalized.
iii. Monopoly with external cost not internalized.
iv. Monopoly with external cost internalized.
(As the instructions were not clear in the question, I just answered 1 question as per HOMEWORKLIB RULES.)
The following exercises will be graded out of 17 points. We should have left enough space...
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