-In the above figure, if five million CDs per month are produced and consumed, that is
A) better than producing and consuming four million CDs because more is always better than less.
B) more than the efficient quantity because the marginal social benefit exceeds the marginal social cost.
C) more than the efficient quantity because the marginal social cost exceeds the marginal social benefit.
D) less than the efficient quantity because the opportunity cost exceeds the marginal social benefit.

Question

-In the above figure, if five million CDs per month are produced and consumed, that is
A) better than producing and consuming four million CDs because more is always better than less. 
B) more than the efficient quantity because the marginal social benefit exceeds the marginal social cost. 
C) more than the efficient quantity because the marginal social cost exceeds the marginal social benefit. 
D) less than the efficient quantity because the opportunity cost exceeds the marginal social benefit.

Quizplus · Accepted Answer

Producing and consuming more than the efficient quantity means that the marginal social cost exceeds the marginal social benefit, indicating overproduction.

-In the Above Figure, If Five Million CDs Per Month