(Table: Security in a Residential Community) Use Table: Security in a Residential Community.Suppose that the residential community has 100 residents.The marginal cost of hiring the fourth security guard is _,and the marginal social benefit is _.

A) $150;$200
B) $150;$100
C) $150;$600
D) $600;$1,900

Question

(Table: Security in a Residential Community) Use Table: Security in a Residential Community.Suppose that the residential community has 100 residents.The marginal cost of hiring the fourth security guard is _____,and the marginal social benefit is _____.

A) $150;$200
B) $150;$100
C) $150;$600
D) $600;$1,900

LaTasha Murphy · Accepted Answer

Final Answer : B, Explanation :  From the table, we can see that the fourth security guard provides a marginal social benefit of $100. At the same time, the marginal cost of hiring the fourth security guard is $150. Thus, hiring the fourth security guard would result in a net loss of $50 ($100 - $150). Therefore, it is not the best choice. The best choice would be to hire only the first three security guards since they provide a net marginal benefit.

(Table: Security in a Residential Community) Use Table: Security in a Residential Community.Suppose that the residential community has 100 residents.The marginal cost of hiring the fourth security guard is _,and the marginal social benefit is _.

A) $150;$200
B) $150;$100
C) $150;$600
D) $600;$1,900

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