Figure 5-6 shows the market for measles vaccinations,a product whose use generates positive externalities.
-Refer to Figure 5-6.What is the economically efficient output level?

Question

Quizplus · Accepted Answer

The economically efficient output level is where the marginal social benefit (MSB) equals the marginal social cost (MSC), which occurs at Q2. This is also the quantity at which the demand curve (representing MSB) intersects with the MSC curve. Therefore, the best choice is to produce Q2 units of the measles vaccination to achieve economic efficiency.

Figure 5-6 Shows the Market for Measles Vaccinations,a Product Whose