In Adam Smith's terminology, the value in use is not as great as the cost of producing the additional output. Therefore, there are alternate uses in which the resources used to produce this additional output are valued more highly by consumers. When stated in this manner, the argument is based upon logic usually under advanced under a label of "welfare economics". Under the marginal-cost solution presented in Figure 4-1, there would be excess profits because price is above the average cost. However, this need not be a problem because the excess profits can be used to pay taxes.