Which type of supply refers to the supply of a good or service that considers only the private costs of its production?

• A. Private supply
• B. Social supply
• C. Public supply
• D. Market supply

Answer: (A)

Verified step by step guidance

1. Understand the concept of 'private costs' in production, which are the costs borne directly by the producer, such as materials, labor, and capital expenses.
2. Recognize that 'private supply' refers to the quantity of a good or service that producers are willing to supply based solely on these private costs, without accounting for any external costs or benefits to society.
3. Differentiate 'private supply' from 'social supply,' which includes both private costs and external costs (or benefits) to society, reflecting the true societal cost of production.
4. Note that 'public supply' typically refers to goods or services provided by the government, and 'market supply' is the total supply from all producers in the market, generally based on private costs.
5. Conclude that the supply type considering only private costs of production is called 'private supply.'