According to the equimarginal principle,the efficient level of government expenditures occurs when the benefit of the last dollar spent for each purchase is greater than the last dollar of cost.

Question

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The equimarginal principle states that the efficient allocation of resources occurs when the ratio of the marginal utility (benefit) to the marginal cost is equal for all choices. Therefore, the efficient level of government expenditures would occur when the marginal benefit of the last dollar spent is equal to the marginal cost of that dollar, not when it is greater than the last dollar of cost.

According to the Equimarginal Principle,the Efficient Level of Government Expenditures