-The figure above illustrates the marginal private cost and the marginal social cost to the city of Geelong for each rock concert that is offered. It also illustrates the marginal benefit. There is no external benefit. If the city of Geelong puts on 5 concerts per year, then the marginal benefit will
A) equal the marginal private cost.
B) equal the marginal social cost.
C) exceed the marginal social cost.
D) be less than the marginal social cost.
E) None of the above answers is correct.

Question

-The figure above illustrates the marginal private cost and the marginal social cost to the city of Geelong for each rock concert that is offered. It also illustrates the marginal benefit. There is no external benefit. If the city of Geelong puts on 5 concerts per year, then the marginal benefit will
A) equal the marginal private cost. 
B) equal the marginal social cost. 
C) exceed the marginal social cost. 
D) be less than the marginal social cost. 
E) None of the above answers is correct.

Quizplus · Accepted Answer

The marginal benefit will exceed the marginal social cost because the number of concerts is less than the socially optimal level where marginal benefit equals marginal social cost.

-The Figure Above Illustrates the Marginal Private Cost and the Marginal