Suppose that a vaccine is developed for a highly contagious strain of flu.The likelihood that anyone will get this flu decreases as more people receive the vaccine.
-Private benefits are measured by ______ and social benefits are measured by _____.
A) D-1;MC
B) D-2;MC
C) D-1;D-2
D) D-2;D-1
E) D-2 + D-1;MC

Question

Suppose that a vaccine is developed for a highly contagious strain of flu.The likelihood that anyone will get this flu decreases as more people receive the vaccine. 
-Private benefits are measured by ______ and social benefits are measured by _____.
A) D-1;MC 
B) D-2;MC 
C) D-1;D-2 
D) D-2;D-1 
E) D-2 + D-1;MC

Quizplus · Accepted Answer

Private benefits are measured by demand (D-1) because individuals are willing to pay a certain amount for the vaccine based on how much they value avoiding getting sick. Social benefits are measured by total demand (D-1 + D-2) because it includes the private benefits as well as the additional benefits to society from reduced transmission and spread of the flu. However, in this scenario, since the question only asks about the measuring of benefits, we can assume that we are only dealing with the demand for the vaccine and not the actual benefits received. Therefore, the answer is C.

Suppose That a Vaccine Is Developed for a Highly Contagious