If at the quantity determined by private costs and benefits, the marginal social benefit of a public good is greater than the marginal social cost of providing the good:
A) the private market will best determine how much of the good will be provided and to whom.
B) a community will best provide the good.
C) the community will not provide the good.
D) free riding will not occur, so the private market will provide the socially optimal amount.

Question

Quizplus · Accepted Answer

When the marginal social benefit exceeds the marginal social cost, it indicates that the community would benefit from providing more of the public good, as the private market often underprovides due to free-rider problems.

If at the Quantity Determined by Private Costs and Benefits