Overproduction compared to the efficient amount implies that for the last unit produced
A) marginal social benefit exceeds marginal social cost.
B) marginal social benefit equals marginal social cost.
C) marginal social cost exceeds marginal social benefit.
D) the deadweight loss is zero.

Question

Quizplus · Accepted Answer

Overproduction means producing beyond the efficient level, where marginal social cost exceeds marginal social benefit, leading to a deadweight loss.

Overproduction Compared to the Efficient Amount Implies That for the Last