The total cost to society of producing an additional unit of a good or service is the ?
Correct answer: B. marginal social cost
- A. marginal damage cost
- B. marginal social cost
- C. marginal private cost
- D. marginal external cost
Explanation
Marginal social cost is the total extra cost to society from producing one more unit, including both the producer's marginal private cost and any external cost. Marginal external cost is only the additional harm imposed on others.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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