Which of the following is the correct equation for the marginal social cost of a good (MSC)?
A)MSC = MPC + MEB
B)MSC = MPC MEC
C)MSC = MPC + MEC
D)MSC = MEC MPC

Question

Quizplus · Accepted Answer

The correct equation for the marginal social cost of a good is MSC = MPC + MEC.
Key Takeaway: The marginal social cost of a good is the cost of consuming or producing a particular good-both by the individual who is consuming or producing the good and by individuals who are not consuming or producing it but are affected by someone else consuming or producing it. To determine the marginal social cost of the good (MSC), add together the marginal personal cost (MPC) to the marginal external cost (MEC).

Which of the Following Is the Correct Equation for the Marginal