The figure below shows the demand and supply curves for pollution abatement.
FIGURE 17- 3
-The socially optimal level of output of any good is the quantity where all marginal costs of production,private plus external,equal the

Question

The figure below shows the demand and supply curves for pollution abatement.
  FIGURE 17- 3
-The socially optimal level of output of any good is the quantity where all marginal costs of production,private plus external,equal the

Quizplus · Accepted Answer

The socially optimal level of output is where the marginal cost (MC) of production equals the marginal benefit (MB) to society. In this case, the socially optimal level of pollution abatement is where the marginal cost of abatement equals the marginal benefit to society, which is the intersection of the demand and supply curves. Therefore, the correct answer is B, which is the option that represents the marginal benefit to society.

The Figure Below Shows the Demand and Supply Curves for Pollution