(Figure: Market 5) Use the graph to answer the question.
The graph shows the marginal social benefit, demand, and supply curves in the toothbrush market. What are the socially optimal quantity and price?

Question

Quizplus · Accepted Answer

The socially optimal quantity is where marginal social benefit equals marginal social cost. In this graph, that occurs at a quantity of 6. The corresponding price can be found by looking at the demand curve at a quantity of 6, which intersects with a price of $6. Therefore, the socially optimal quantity and price are 6 and $6, respectively.

(Figure: Market 5) Use the Graph to Answer the Question