Suppose a human life is worth $10 million.Installing a better lighting system in the city park would reduce the risk of a murder taking place there from 3.5 to 2.1 percent over the life of the system.At what cost should the city install the new lighting system
A)if its cost does not exceed $70,000
B)if its cost does not exceed $140,000
C)if its cost does not exceed $190,000
D)if its cost does not exceed $10,000,000

Question

Quizplus · Accepted Answer

The reduction in risk is 1.4% (3.5% - 2.1%). The value of a human life is $10 million, so the expected benefit is 1.4% of $10 million, which is $140,000. Therefore, the city should install the system if the cost does not exceed $140,000.

Suppose a Human Life Is Worth $10 Million