If antibiotic users get all the benefits of antibiotics but do not bear all of the costs, the social marginal cost of antibiotic use at the market equilibrium will be:
A) higher than the marginal cost to antibiotic sellers.
B) less than the marginal cost to antibiotic sellers.
C) higher than the marginal benefit to the antibiotic buyers.
D) less than the marginal benefit to the antibiotic buyers.

Question

Quizplus · Accepted Answer

The social marginal cost includes both the private cost to antibiotic sellers and the external cost imposed on society, such as the development of antibiotic-resistant bacteria. If antibiotic users do not bear these costs, the social marginal cost will be higher than the private marginal cost to antibiotic sellers.

If Antibiotic Users Get All the Benefits of Antibiotics but Do