If antibiotic users get all the benefits of antibiotics but do notbear all of the costs, the social marginal cost of antibiotic useat the market equilibrium will be:
A)higher than the marginal cost to antibiotic sellers.(True Answer )Correct
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

When antibiotic users do not bear all of the costs of antibiotic use, such as the development of antibiotic resistance, the social marginal cost of antibiotic use is higher than the marginal cost to antibiotic sellers. This is because the social marginal cost takes into account the negative externalities, or costs to society, that are not reflected in the market price of antibiotics. Therefore, the optimal choice would be to implement policies that internalize these external costs, such as taxation or regulation, to ensure that the market equilibrium reflects the true social cost of antibiotic use.

If Antibiotic Users Get All the Benefits of Antibiotics but Do