If the marginal benefit received from a good is equal to the marginal opportunity cost of production, then:
A) society's well-being can be improved if production increases.
B) society's well-being can be improved if production decreases.
C) the market is producing too much of the good.
D) the market is producing an efficient quantity.

Question

Quizplus · Accepted Answer

When the marginal benefit received from a good is equal to the marginal opportunity cost of production, it means that the market has reached equilibrium, producing the efficient quantity of the good. This is because at this point, the benefit gained by producing one more unit of the good is equal to the cost of producing that unit, indicating that resources are being allocated efficiently. Therefore, the market is producing an efficient quantity.

If the Marginal Benefit Received from a Good Is Equal