If the marginal cost of producing a public good is less than society's total willingness to pay per unit, then
A. the optimal amount of the public good is being produced.
B. more than the optimal amount of the public good is being produced.
C. less than the optimal amount of the public good is being produced.
D. the amount of output being produced could be either greater than or less than the optimal amount.
Answer: C
You might also like to view...
Refer to the figure below. If VMP mkt can be characterized by the equation VMP mkt = 50 - 2H mkt , where H is the number of hours worked, and VMP home can be characterized by the equation VMP home = 45 - 3H home , where H is the number of hours worked, what is H* if there are a total of 40 hours to be worked between work and home?
Final goods and services refer to:
a) goods and services that are unsold and therefore added to inventories. b) goods and services whose value has been adjusted for changes in the price level. c) goods and services purchased by ultimate users, rather than for resale or further processing. d) the excess of U.S. exports over U.S. imports.
If the stock market plunged over the next week, consumers would:
A. Rush to buy more goods and services. B. Buy more stocks to make up for their losses. C. Demand fewer goods and services. D. Cause the aggregate demand curve to shift to the right.
Which of the following would be an example of case-based payment?
A. Four-tier pharmacy formularies B. Copayment waivers for primary care services C. Medicare DRGs D. All of the above