-The table above shows information about the costs and benefits of a steel smelter that pollutes the air of a city.The market is efficient when the quantity of steel produced is ________ tons per week.
A) 5
B) 10
C) 15
D) 20
E) 25

Question

-The table above shows information about the costs and benefits of a steel smelter that pollutes the air of a city.The market is efficient when the quantity of steel produced is ________ tons per week.
A) 5 
B) 10 
C) 15 
D) 20 
E) 25

Quizplus · Accepted Answer

In a market, efficiency is achieved when the marginal cost (MC) of production equals the marginal benefit (MB) to society. Without the specific numbers from the table, we can't calculate the exact point of efficiency. However, the principle is that at the efficient quantity, the additional cost of producing one more unit (including external costs like pollution) is equal to the additional benefit that one more unit provides to society. Since we can't see the table, the correct answer is based on the principle that the market is efficient where MC = MB, which typically occurs at a medium level of production, not at the extremes. Hence, without specific data, a middle value like 15 tons per week (option C) is a plausible guess for where this balance might occur.

-The Table Above Shows Information About the Costs and Benefits