Exhibit 17.8

-Refer to Exhibit 17.8,which shows the demand,the supply,and the marginal social benefit curves.The socially efficient level of output is _______
A)0 units.
B)10 units.
C)20 units.
D)40 units.
E)50 units.

Question

Exhibit 17.8
 
-Refer to Exhibit 17.8,which shows the demand,the supply,and the marginal social benefit curves.The socially efficient level of output is _______
A)0 units. 
B)10 units. 
C)20 units. 
D)40 units. 
E)50 units.

Quizplus · Accepted Answer

The socially efficient level of output is where the marginal social benefit curve intersects the supply curve, which represents the marginal social cost. This point ensures that the additional benefits to society from consuming one more unit of the good equal the additional costs to society of producing that unit.

Exhibit 17.8 -Refer to Exhibit 17.8,which Shows the Demand,the Supply,and the Marginal