To maximize the net social benefit received from a good or service, it should be produced up to the point where:

Question

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Maximizing net social benefit occurs when a good or service is produced up to the point where its marginal social benefit is equal to its marginal social cost. This takes into account both the private benefit and externalities (positive or negative effects on third parties) associated with the production and consumption of the good or service. Option A only takes into account social benefit and cost, whereas option B only takes into account private benefit and social cost. Option D only takes into account social benefit and private cost, and option E only takes into account private benefit and cost. Therefore, option C represents the best choice for maximizing net social benefit.

To Maximize the Net Social Benefit Received from a Good