If the marginal social benefit received from a good is less than the marginal social cost of production:
A)an increase in production will improve society's well-being.
B)a decrease in production will improve society's well-being.
C)no change in production can improve society's well-being.
D)the market is producing too little of the good.

Question

Quizplus · Accepted Answer

If the marginal social benefit is less than the marginal social cost of production, producing more of the good would create an inefficient allocation of resources, leading to a decrease in overall social welfare. Therefore, decreasing production would be the best option to improve society's well-being.

If the Marginal Social Benefit Received from a Good Is