To Determine How Much of a Good to Produce to Achieve

Multiple Choice

To determine how much of a good to produce to achieve allocative efficiency,we

A) construct a production possibilities frontier and choose the midpoint.
B) construct a production possibilities frontier and choose any point on it.
C) must produce on the PPF and at the point where the marginal benefit and marginal cost of the good are equal.
D) must produce on the PPF and at the point where the marginal benefit exceeds by any amount the marginal cost of the good.
E) must produce on the PPF and at the point where the marginal benefit exceeds by as much as possible the marginal cost of the good.