Suppose that the marginal benefit of having a security guard at the airport is MB₁,at the bank is MB₂,and at the mall is MB₃.The marginal cost of assigning security guard is the same for all three places,and it is represented by MC₂.
Starting with MB₁ (marginal benefit curve for the airport) and MC₂,suppose the federal government decided to increase security at the airport.As a result training costs for security guards increases.This would shift ______ and ______ the optimal number of security guard at the airport.

Question

Suppose that the marginal benefit of having a security guard at the airport is MB₁,at the bank is MB₂,and at the mall is MB₃.The marginal cost of assigning security guard is the same for all three places,and it is represented by MC₂.

Suppose that the marginal benefit of having a security guard at the airport is MB<sub>1</sub>,at the bank is MB<sub>2</sub>,and at the mall is MB<sub>3</sub>.The marginal cost of assigning security guard is the same for all three places,and it is represented by MC<sub>2</sub>. Starting with MB<sub>1</sub> (marginal benefit curve for the airport) and MC<sub>2</sub>,suppose the federal government decided to increase security at the airport.As a result training costs for security guards increases.This would shift ______ and ______ the optimal number of security guard at the airport. A) MC<sub>2</sub> to MC<sub>3</sub><sub>;</sub> increase B) MC<sub>2</sub> to MC<sub>3</sub><sub>;</sub> decrease C) MC<sub>1</sub> to MC<sub>2</sub><sub>;</sub> increase D) MC<sub>2</sub> to MC<sub>1</sub><sub>;</sub> increase

Starting with MB₁ (marginal benefit curve for the airport) and MC₂,suppose the federal government decided to increase security at the airport.As a result training costs for security guards increases.This would shift ______ and ______ the optimal number of security guard at the airport.

Quizplus · Accepted Answer

When the training costs for security guards increases, the marginal cost of assigning a security guard will increase, leading to a shift from MCS1U1B12S1U1B0 to MCS1U1B13S1U1B0S1U1B1. This, in turn, will decrease the optimal number of security guards at the airport, as the marginal cost now outweighs the marginal benefit (MBS1U1B11S1U1B0). Therefore, the best answer is B.

Suppose That the Marginal Benefit of Having a Security Guard