The table below shows the marginal benefit and marginal cost of purchasing an additional unit of 3 different public goods. $$\begin{array} { | c | c | c | c | }
\hline & \text { Marginal benefit } & \text { Marginal cost } & \begin{array} { c }
\text { Total spending on the } \
\text { public good }
\end{array} \
\hline \text { Public good 1 } & \$ 20 & \$ 20 & \$ 1,500 \
\hline \text { Public good 2 } & \$ 15 & \$ 25 & \$ 800 \
\hline \text { Public good 3 } & \$ 10 & \$ 5 & \$ 700 \
\hline
\end{array}$$

Question

The table below shows the marginal benefit and marginal cost of purchasing an additional unit of 3 different public goods. $$\begin{array} { | c | c | c | c | } 
\hline & \text { Marginal benefit } & \text { Marginal cost } & \begin{array} { c } 
\text { Total spending on the } \
\text { public good }
\end{array} \
\hline \text { Public good 1 } & \$ 20 & \$ 20 & \$ 1,500 \
\hline \text { Public good 2 } & \$ 15 & \$ 25 & \$ 800 \
\hline \text { Public good 3 } & \$ 10 & \$ 5 & \$ 700 \
\hline
\end{array}$$

Quizplus · Accepted Answer

When the marginal benefit equals the marginal cost, it indicates an efficient allocation of resources. For public good 1, the marginal benefit ($20) equals the marginal cost ($20).

The Table Below Shows the Marginal Benefit and Marginal Cost