If the marginal benefit received from a good is equal to the marginal social cost of production, then:
A)society's well-being can be improved if production increases.
B)the market is producing an efficient quantity.
C)the market is producing too much of the good.
D)society's well-being can be improved if production decreases.

Question

Quizplus · Accepted Answer

When the marginal benefit received from a good is equal to the marginal social cost of production, it means that the social marginal benefit is equal to the social marginal cost, which is the efficient level of production. This means that the market is producing an efficient quantity, and any increase or decrease in production would result in a decrease in overall social welfare. Therefore, the best answer is B, as it signifies an efficient allocation of resources.

If the Marginal Benefit Received from a Good Is Equal