The Efficient Output Level of a Public Good Occurs Where

question 43

Multiple Choice

The efficient output level of a public good occurs where the

• A)greatest number of free riders occurs.
• B)marginal cost of producing the last unit is equal to the marginal benefit realised by consumers.
• C)total cost of production is affordable.
• D)marginal cost of production is at its lowest.

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Definitions:

Deferred Credit

Liabilities or income that have been recognized but not yet earned, and therefore, postponed to a future accounting period.

Contra Account

An account that is used to reduce the value of a related account on a financial statement and presents the net balance of both accounts.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against a fixed asset since it was put into use.

Anticipated Benefits

Anticipated benefits are the expected positive outcomes or gains that result from particular actions or investments.