Use the figure below to answer the following questions.

Figure 17.3.1
-Figure 17.3.1 shows the marginal private cost curve, marginal social cost curve, and marginal social benefit curve for cod, a common resource. The efficient quantity is
A)0 kilograms a week.
B)4,000 kilograms a week.
C)3,000 kilograms a week.
D)5,000 kilograms a week.
E)1,000 kilograms a week.

Question

Use the figure below to answer the following questions.
  
Figure 17.3.1
-Figure 17.3.1 shows the marginal private cost curve, marginal social cost curve, and marginal social benefit curve for cod, a common resource. The efficient quantity is
A)0 kilograms a week. 
B)4,000 kilograms a week. 
C)3,000 kilograms a week. 
D)5,000 kilograms a week. 
E)1,000 kilograms a week.

Quizplus · Accepted Answer

The efficient quantity is where the marginal social cost equals the marginal social benefit, which is 3,000 kilograms a week as shown by the intersection of the two curves. This is the quantity that maximizes total surplus and minimizes the negative externalities associated with overfishing. Thus, choice C is the best choice.

Use the Figure Below to Answer the Following Questions