The optimal level of provision of public goods is where societyʹs total willingness to pay per unit is equal to the
A) total cost of producing the good.
B) average cost of producing the good.
C) variable cost of producing the good.
D) marginal cost of producing the good.

Question

Quizplus · Accepted Answer

The optimal level of provision of public goods occurs where society's total willingness to pay per unit equals the marginal cost of producing the good. This ensures that the resources are used efficiently, providing the maximum benefit to society without wasting resources.

The Optimal Level of Provision of Public Goods Is Where