Author Question: Suppose that the marginal social benefit from another unit of a public good is less than the ... (Read 188 times)

Jipu 123 · **on:** Jun 29, 2018

Suppose that the marginal social benefit from another unit of a public good is less than the marginal social cost of producing it. Then

A) the principle of minimum differentiation means that production should be decreased.
B) the number of free riders is at its efficient amount.
C) less of the product should be produced because its provision exceeds the efficient level.
D) more of the product should be produced because its provision is less than the efficient level.

Question 2

In the above figure, at a price of 6, a perfectly competitive firm produces ________ and it ________.

A) some output; incurs an economic loss
B) 0; incurs an economic loss
C) 0; does not incur an economic loss or make an economic profit
D) 0; makes an economic profit