refer to the following diagram. MCs is the firm’s marginal cost of providing safety, while MBs is the marginal benefit to society of a one more unit of safety. Because of imperfect information and costly worker mobility, MBs’ is the firm’s perceived marginal benefit of safety.
-The MC_s curve is upward sloping because:

Question

refer to the following diagram. MCs is the firm’s marginal cost of providing safety, while MBs is the marginal benefit to society of a one more unit of safety. Because of imperfect information and costly worker mobility, MBs’ is the firm’s perceived marginal benefit of safety.

-The MC_s curve is upward sloping because:

Quizplus · Accepted Answer

The upward slope of the MC_s curve suggests that the firm uses relatively low-cost techniques initially to improve worker safety. As they invest more in safety, the marginal cost of providing safety increases, causing the curve to slope upward. This is because the initial investment in safety may involve low-cost techniques like providing safety training to workers or distributing safety equipment, but as firms invest more, they may need to replace older equipment or invest in more expensive safety measures like automation or redesigning the workplace layout, which drives up the marginal cost of safety.

Refer to the Following Diagram