The socially optimal level of output is the quantity where all marginal costs of production, private plus external, equal the

Question

Quizplus · Accepted Answer

The socially optimal level of output is where the marginal benefit to society is equal to the marginal cost of production, taking into account all external costs. This is because at this level, the total benefit to society is maximized, and any further production would result in a higher marginal cost than marginal benefit. Therefore, the correct answer is D, marginal benefit to society.

The Socially Optimal Level of Output Is the Quantity Where