If the government is supplying a public good, the efficient quantity occurs where the:
A)total social benefit equals the cost.
B)marginal social benefit is greater than the cost.
C)marginal social benefit equals the cost.
D)total social benefit outweighs the total cost.

Question

Quizplus · Accepted Answer

The efficient quantity of a public good is achieved when the marginal social benefit (MSB) of consuming one more unit of the good equals its marginal cost (MC). This ensures that resources are allocated in a way that maximizes societal welfare.

If the Government Is Supplying a Public Good, the Efficient