When the rate of output is at the socially efficient level,the total willingness to pay is as large as possible.
At the socially efficient level of output net social value which is equal to total WTP minus total costs is as large as possible.

Question

Quizplus · Accepted Answer

The socially efficient level of output maximizes net social value, not total willingness to pay. Total willingness to pay can be larger at different output levels, but the socially efficient level balances total benefits and total costs to maximize net social value.

When the Rate of Output Is at the Socially Efficient