Producing paper creates pollution. The efficient quantity of paper is when the


A. marginal social benefit of paper is equal to zero.
B. marginal social cost of the pollution from making paper is equal to zero.
C. marginal social of paper is equal to the marginal social cost of paper.
D. marginal private cost of the pollution from making paper is equal to zero.

I think it's A but not sure

To determine the efficient quantity of paper production, we need to consider the concept of marginal social benefit (MSB) and marginal social cost (MSC).

First, let's understand what these terms mean:

1. Marginal Social Benefit (MSB): This refers to the additional benefit gained by society from producing an additional unit of a good or service. It takes into account not only the private benefits to the consumer but also any external benefits or positive effects on society as a whole.

2. Marginal Social Cost (MSC): This represents the additional cost imposed on society from producing an additional unit of a good or service. It includes both the private costs incurred by the producer and any external costs or negative impacts on society.

Now, let's evaluate the given options:

A. Marginal social benefit of paper is equal to zero: This suggests that there are no additional benefits to society from producing an additional unit of paper. However, it does not account for any external benefits or positive impacts that paper production might have on society. Therefore, this option does not accurately represent the efficient quantity of paper.

B. Marginal social cost of the pollution from making paper is equal to zero: This option implies that the pollution resulting from paper production has no additional costs to society. However, this overlooks the negative external costs of pollution. Therefore, this option does not represent the efficient quantity of paper.

C. Marginal social benefit of paper is equal to the marginal social cost of paper: This option represents the efficient quantity of paper. It suggests that the additional benefits to society from producing an extra unit of paper are equal to the additional costs imposed on society as a whole. This balance ensures that the overall welfare is maximized.

D. Marginal private cost of the pollution from making paper is equal to zero: This option only considers the private costs borne by the producer and does not take into account the broader social costs of pollution. Therefore, it does not represent the efficient quantity of paper production.

Based on the explanations above, option C is the correct answer. The efficient quantity of paper is when the marginal social benefit of paper is equal to the marginal social cost of paper.