Question

When an additional unit of output is produced, the extra cost to society is the

A) average total cost.
B) marginal social cost.
C) marginal private cost.
D) marginal external cost.
E) marginal damage.

Answer 1

The extra cost to society when an additional unit of output is produced is the marginal social cost, which includes both private costs of production and any external costs imposed on society. This cost is important in determining the optimal level of production.

Step-by-step explanation:

When an additional unit of output is produced, the extra cost to society is the marginal social cost. Marginal social cost represents the cost to society from making the last unit of a good. It includes both the private costs of production and any external costs imposed on society as a whole. Marginal social cost is an important consideration in determining the optimal level of production for a good.