Assuming there are no externalities, if a firm is producing at an output level where the benefits to consumers exceed the cost to the suppliers to produce it, then price
A) equals marginal cost.
B) is greater than marginal cost.
C) is less than marginal cost.
D) is less than marginal revenue.

Question

Quizplus · Accepted Answer

When the benefits to consumers exceed the cost to suppliers, it indicates that the price consumers are willing to pay is higher than the cost of production. This scenario typically results in a price that is greater than the marginal cost, as firms capitalize on the consumer surplus.

Assuming There Are No Externalities, If a Firm Is Producing