If the marginal benefit received from a good is less than the marginal cost of production, then:
A) society's well-being can be improved if production increases.
B) society's well-being cannot be improved by changing production.
C) the market is producing too much of the good.
D) the market is producing too little of the good.

Question

Quizplus · Accepted Answer

When the marginal benefit of a good is less than its marginal cost of production, it indicates that resources are being overallocated to produce that good, implying that the market is producing too much of it. Reducing production would align costs and benefits more closely, potentially improving societal well-being.

If the Marginal Benefit Received from a Good Is Less