Asked by Tyler Knight on May 04, 2024
Verified
The optimal level of provision of ________ goods is where society's total willingness to pay per unit is equal to the marginal cost of producing the good.
A) public
B) private
C) all
D) normal
Optimal Level
The most favorable balance or degree of any variable or condition for achieving maximum efficiency or effectiveness.
Public Good
A product or service that is available for all people to consume, without being depleted, regardless of who pays for it.
- Explain the concept of the optimal level of provision for public goods.
Verified Answer
AJ
Ahmed JawoanMay 11, 2024
Final Answer :
A
Explanation :
Public goods are non-excludable and non-rivalrous, meaning they are available to all members of society without additional cost for extra users. The optimal provision level is where the total willingness to pay equals the marginal cost of production, ensuring efficient allocation of resources.
Learning Objectives
- Explain the concept of the optimal level of provision for public goods.
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