Refer to the figure below. At the market equilibrium quantity, the social marginal cost of the last ton of paper produced is ________ the marginal benefit of the last ton of paper produced.
A)less than or equal to
B)equal to
C)less than
D)greater than

Question

Refer to the figure below. At the market equilibrium quantity, the social marginal cost of the last ton of paper produced is ________ the marginal benefit of the last ton of paper produced. 
A)less than or equal to 
B)equal to 
C)less than 
D)greater than

Quizplus · Accepted Answer

The private market equilibrium occurs at the intersection of the demand curve and the private MC curve. At this level of output, the social marginal cost of the last ton of paper produced is greater than the marginal benefit of the last ton of paper produced.

Refer to the Figure Below