The efficient scale of provision of a public good occurs where
A)total benefit is at a maximum.
B)total benefit is at a minimum.
C)marginal social benefit is at a maximum.
D)marginal social benefit minus marginal social cost equals zero.
E)marginal social cost is at a minimum.

Question

Quizplus · Accepted Answer

The efficient scale of provision of a public good occurs where the marginal social benefit equals the marginal social cost. This condition is met only when marginal social benefit minus marginal social cost equals zero, which is the condition given in option D.

The Efficient Scale of Provision of a Public Good Occurs