Use the following to answer questions:
-(Table: Marginal Benefit from Additional Streetlights) Look at the table Marginal Benefit from Additional Streetlights. Suppose that the marginal cost of installing a streetlight is $6. What is the maximum that Art would be willing to pay to have one streetlight installed in the neighborhood?
A) $20
B) $15
C) $35
D) $5

Question

Use the following to answer questions: 
-(Table: Marginal Benefit from Additional Streetlights) Look at the table Marginal Benefit from Additional Streetlights. Suppose that the marginal cost of installing a streetlight is $6. What is the maximum that Art would be willing to pay to have one streetlight installed in the neighborhood?
A) $20 
B) $15 
C) $35 
D) $5

Quizplus · Accepted Answer

Art would be willing to pay up to the marginal benefit he receives from the first streetlight, which is $20, as long as it is greater than the marginal cost of $6.

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