When Overproduction of a Good Occurs

question 75

Multiple Choice

When overproduction of a good occurs

• A)deadweight loss is eliminated.
• B)the sum of consumer surplus and producer surplus is maximized.
• C)marginal social cost exceeds marginal social benefit.
• D)marginal social benefit exceeds marginal social cost.
• E)the good is a public good.

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Definitions:

Surplus

The amount of a product or service exceeding the demand for it, typically resulting in lower prices.

World Market

The global marketplace where goods, services, and financial securities are traded across countries.

College Costs

The total expenses associated with attending a college or university, which include tuition, room and board, books, and other fees.

Trend

A long-term direction or pattern in data, often observed in economic variables, stock market prices, or consumer behavior over time.