To Determine the Efficient Quantity of a Public Good to Supply

question 17

Multiple Choice

To determine the efficient quantity of a public good to supply,

• A) the private firms that will produce the good each produce the exact same quantity.
• B) politicians use the principle of maximum differentiation.
• C) total benefit is equated to total cost, the same as is done to determine the efficient quantity of a private good.
• D) marginal benefit and marginal cost are equated, the same as is done to determine the efficient quantity of a private good.
• E) marginal benefit must exceed marginal cost by as much as possible.

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Definitions:

Means

The statistical measure that identifies the central tendency of a data set by dividing the sum of all values by the number of values.

T-test

A statistical test used to compare the means of two groups and determine if the differences between them are statistically significant.

Independent Means

Refers to the average values derived from two separate groups that are not related to each other, often used in statistical comparisons.

Sophomores

Second-year students in a four-year degree program at a high school or university.