At the Current Quantity of Pizza, the Marginal Social Benefit

question 358

Multiple Choice

At the current quantity of pizza, the marginal social benefit is greater than the marginal social cost. Then

• A) the number of pizzas produced is efficient.
• B) more pizzas must be produced to reach the efficient level.
• C) fewer pizzas must be produced to reach the efficient level.
• D) revenue for pizza producers is maximized.

---

Definitions:

Variable Costs

Costs that vary directly with the level of output or production, such as materials and labor costs.

Industry Short-run

A period in which at least one of a firm's inputs is fixed, limiting the firm's ability to adjust fully to market changes.

Marginal Cost

The financial addition incurred by manufacturing one more unit of a product or service.

Fixed Cost

represents expenses that do not change in total regardless of the level of output or activity, such as rent or salaries.