If the marginal benefit received from a good is less than the marginal opportunity 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 opportunity cost, it indicates that resources are being overallocated to produce that good. Therefore, reducing production would align the allocation of resources more closely with consumer preferences, improving societal well-being.

If the Marginal Benefit Received from a Good Is Less