With regard to a public good, the social benefit derived from consuming an additional unit of the good is lower than the private marginal benefit.

Question

Quizplus · Accepted Answer

Public goods are characterized by non-excludability and non-rivalry, meaning that one person's consumption does not reduce the amount available for others, and it's not possible to exclude others from using the good. Therefore, the social benefit (or marginal social benefit) of consuming an additional unit of a public good is typically equal to or greater than the private marginal benefit, as it includes both the private benefit and any external benefits to others.

With Regard to a Public Good, the Social Benefit Derived