For a common resource, the marginal benefit at the quantity provided by a private market is ________ the marginal social cost.
A)equal to
B)greater than
C)less than
D)greater than or equal to

Question

Quizplus · Accepted Answer

A private market will only consider individual benefits and costs, while a common resource has externalities that affect society as a whole. Therefore, the marginal social cost (taking into account the externalities) will generally exceed the marginal benefit provided by a private market.

For a Common Resource, the Marginal Benefit at the Quantity