If the Marginal Social Cost of Producing a Public Good

question 66

Multiple Choice

If the marginal social cost of producing a public good is greater than the marginal social benefit,then

• A)more than the efficient quantity of the public good is being produced.
• B)less than the efficient quantity of the public good is being produced.
• C)the efficient quantity of the public good is being produced.
• D)the public good is being produced by a private firm.
• E)the public good must be a common resource.

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Definitions:

Influx

The arrival or entry of a large number of people or things into a place.

Production Possibility Frontier

An illustration that outlines the peak production capacities for a pair of goods, considering the available resources and technological advancements.

Efficient

Description of a market or economy that takes all opportunities to make some people better off without making other people worse off.

Production Rate

The speed at which goods are manufactured or produced in a given period.