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Figure: An Individual's Marginal Benefit from a Public Good
-(Figure: An Individual's Marginal Benefit from a Public Good) Look at the figure An Individual's Marginal Benefit from a Public Good. Assume that two individuals will share consumption of a public good; each individual has the marginal benefit curve shown in the figure. What is the total social benefit from four units of the public good?
A) $16
B) $60
C) $144
D) $200

Question

Use the following to answer questions:
Figure: An Individual's Marginal Benefit from a Public Good 
-(Figure: An Individual's Marginal Benefit from a Public Good) Look at the figure An Individual's Marginal Benefit from a Public Good. Assume that two individuals will share consumption of a public good; each individual has the marginal benefit curve shown in the figure. What is the total social benefit from four units of the public good?
A) $16 
B) $60 
C) $144 
D) $200

Quizplus · Accepted Answer

The total social benefit is the sum of the marginal benefits for each unit of the public good. If each individual has the same marginal benefit curve, the total social benefit is twice the individual benefit. For four units, if the individual benefit is $72, the total social benefit is $144.

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