Which of the following represents an efficient quantity of a public good? The quantity at which the
A) marginal cost of production is minimized.
B) number of free riders is maximized.
C) marginal benefit minus marginal cost is minimized.
D) marginal benefit is equal to the marginal cost.
E) marginal benefit exceeds the marginal cost by the maximum amount possible.

Question

Quizplus · Accepted Answer

An efficient quantity of a public good is where the marginal benefit equals the marginal cost. This is because at this quantity, society is getting the most benefit (MB) from the production of the good without overpaying in terms of resources (MC). Therefore, Choice D is the correct answer.

Which of the Following Represents an Efficient Quantity of a Public