Use the figure below to answer the following questions. Figure 15.3.1
-Refer to Figure 15.3.1.The figure shows the marginal private benefit curve,the marginal social benefit curve,and the market supply curve.If production is left to the private market,then the quantity produced is

Question

Use the figure below to answer the following questions.

Figure 15.3.1
-Refer to Figure 15.3.1.The figure shows the marginal private benefit curve,the marginal social benefit curve,and the market supply curve.If production is left to the private market,then the quantity produced is

Quizplus · Accepted Answer

At the quantity where the marginal private benefit equals the marginal social benefit (Q₂), the market reaches allocative efficiency, where the social value of producing the good equals the private value. Thus, producing Q₂ is the best choice.

Use the Figure Below to Answer the Following Questions